1951-06-07

Hon. Brooke Claxton (Minister of National Defence):: Mr. Speaker, on June 5 the hon. member for Middlesex East (Mr. White) asked a question about increased security precautions at London.
At the 27th Canadian ordnance depot, London, the security guard now provided consists of twelve watchmen and four security supervisors. An increase of five watchmen was recently approved, and is being proceeded with.
At the subdepot at Hagersville there is a security guard consisting of ten watchmen and three security supervisors. An increase of eight watchmen was recently approved and proceeded with.
The answer to the second question is that negotiations are taking place with the province of Ontario for the purchase of land adjacent to the Ontario hospital in London.



JUVENILE DELINQUENTS ACT


Hon. Stuari S. Garson (Minister of Justice):: Mr. Speaker, yesterday at the request of the hon. member for St. John's West (Mr. Browne) I undertook to state what the position of Newfoundland was in relation to the Juvenile Delinquents Act. I had suggested yesterday that the government of Newfoundland may not have wanted the Juvenile Delinquents Act proclaimed in force in that province. I find upon inquiry that this is the fact. We therefore have not proclaimed it, and as a result no part of this act is now in force in Newfoundland.
I think it is only fair that I should state what the Newfoundland government's present position is in this regard. I telephoned yesterday to the Hon. Leslie Curtis, attorney general of Newfoundland, who informed me then, and has since confirmed this information by wire, that the Newfoundland department of welfare has not asked the Newfoundland government to have the Juvenile Delinquents Act brought into force in Newfoundland,
because the juvenile offenders section, being part II of the Newfoundland Welfare of Children Act, 1944, as amended, is for all practical purposes identical with the federal Juvenile Delinquents Act, 1929. Mr. Curtis states, moreover, that at this year's session a family court was constituted patterned after Quebec legislation, which court will shortly assume the functions of a juvenile court.



PRIVATE BILLS


[Stage Direction]
Bill No. 358, for the relief of Marion Evelyn Peak Collins,-Mr. Winkler.
Bill No. 359, for the relief of John Brock Short.-Mr. Winkler.
Bill No. 360, for the relief of Joseph Duchesne.-Mr. Winkler.
Bill No. 361, for the relief of Eugenie Marjorie Ross Finley-Mr. Winkler.
Bill No. 362, for the relief of Helen Marion Peacock Rondeau.-Mr. Winkler.
Bill No. 363, for the relief of Ruth Mary Halsey Shaw.-Mr. Winkler.
Bill No. 364, for the relief of Rodolphe Boisjoly.-Mr. Winkler.


MILITARY DISTRICTS


Mr. Balcer:: 
Mr. Blanchette:: 1 and 2. The organization of the territory of Canada into eleven military districts was terminated in January, 1946. It was replaced by an organization based on five commands, each of which was further divided into areas, which number seven.

Questions
Command and Commanding Officers
(1)	Western command-headquarters at Edmonton, Alta.
Maj. Gen. C. Vokes, C.B., C.B.E., D.S.O.
(2)	Prairie command-headquarters at Winnipeg, Man.
Brig. R. E. A. Morton, D.S.O.
(3)	Central command-headquarters at Oakville Ont.
Maj. Gen H. D. Graham, C.B.E., D.S.O., E.D.
(4)	Quebec command-headquarters at Montreal, P.Q.
Maj. Gen. R. O. G. Morton, C.B.E.
(5)	Eastern command-headquarters at Halifax, N.S.
Maj. Gen. E. C. Plow, C.B.E., D.S.O., E.D. Area and Commanding Officers
(i)	British Columbia area-headquarters at Vancouver, B.C.
Brig. W. J. Megill, D.S.O. (Detailed to perform the duties of commander 25th Canadian infantry brigade replacement group. Col. E. C. Brown detailed to carry out duties of area commander).
(ii)	Saskatchewan area-headquarters at Regina, Sask.
Brig. A. B. Connelly, C.B.E.
(iii)	Western Ontario area-headquarters at London, Ont.
Brig. J. A. W. Bennett, C.B.E.
(iv)	Eastern Ontario area-headquarters at Kingston, Ont.
Brig. G. Walsh, C.B.E., D.S.O.
(v)	Eastern Quebec area-headquarters at Quebec, P.Q.
Col. M. L. Derome, O.B.E., E.C. (Acting).
(vi)	New Brunswick area-headquarters at Fredericton, N.B.
Brig. G. E. R. Smith, C.B.E.
(vii)	Newfoundland area-headquarters at St. John's, Nfld.
Brig. M. S. Dunn, O.B.E., E.D.
3.	See answer to No. 2.
4.	None.
5.	Two major generals. One is on retirement leave; the other has had his service extended to 1952.
Two brigadiers. One retires June 15, 1951, and the other has had his service extended -to 1953.
6.	No.
7.	Yes; he has had two extensions of one year each.



NATIONAL DEFENCE


Mr. Macdonnell (Greenwood):: 1.	How many civilian employees are engaged in the Department of National Defence?

2. What is the total cost of civilian personnel, including salaries, wages and all other expenses?


Brooke Claxton: Stand.


Mr. Macdonnell (Greenwood):: 1.	In how many locations in Canada do civilian employees of the Department of National Defence number more than (a) 10; (b) 50; (c) 100; (d) 500; (e) 1,000?
2.	What are the names of the stations where there are more than 500 civilian employees located; who is in charge of each such station, and what has been his business or executive experience?


Brooke Claxton: Stand.


Mr. Macdonnell (Greenwood):: 1.	In how many different locations in Canada are civilian employees of the Department of National Defence stationed?
2.	In what different types of employment such as office workers, mechanics, etc., are such civilian employees engaged, and how many are there in each category?


Brooke Claxton: Stand.




Mr. Macdonnell (Greenwood):: 1.	(a) What are the names of the senior fifty executives in charge of civilian staff in the Department of National Defence; (b) which of these are civilians and which service personnel; (c) what is the military, and what is the civilian experience of each as shown in his file; (d) where is each such executive stationed?
2.	Who of (a) the above named executives, and (b) the total civilian employees, in the Department of National Defence, are employed pursuant to the terms of the Civil Service Act?


Brooke Claxton: Stand.


Mr. Macdonnell (Greenwood):: With respect to these four questions, all of which stand,
I should like to ask the Department of National Defence to hurry along the answers as much as possible. If I remember correctly, the minister told us the other night there was certain information they could get within a minute and a half. I tried to phrase these questions so that it would only mean the obtaining of information readily available.


Brooke Claxton: I have heard the observations of the hon. gentleman. I can assure him that none of these questions can be answered in a minute and a half. I should think the least it would take for any of them would be a good many days, if not weeks; but we will bring them on.
COUNTY COURT FOR NEWFOUNDLAND Mr. Higgins:
IViiat steps are being taken to set up a county court in Newfoundland?


Stuart Sinclair Garson: If I may answer this question orally, the constitution of provincial courts comes exclusively within provincial jurisdiction; therefore I think this is a question which more properly should be asked in the Newfoundland legislature.



APPOINTMENT OF FOURTH JUDGE TO NEWFOUNDLAND SUPREME COURT

Mr. Higgins:: What is being done with respect to the appointment of a fourth judge to the Supreme Court of Newfoundland?


Stuart Sinclair Garson: I think this question might
also be answered orally. No legislation has been passed by the Newfoundland legislature which would authorize the appointment of a fourth supreme court judge.



QUESTION PASSED AS ORDER FOR RETURN


Mr. Maltais:: 1.	How many permanent employees in the civil service have not received the salary increase granted by the government at the time of the recent salary adjustment?
2.	How many, by departments?
3.	Did J. A. Lefrancois, PW-CA3-438, attached to the post office of La Malbaie, Quebec, receive such salary adjustment? If not, for what reason?
4.	How many employees in the same category did not receive an increase, and for what reason?



HOUSING


[Stage Direction]
On the orders of the day:
Mr. Charles Henry (Rosedale):: I should like to address two questions to the Minister of Resources and Development. The first question is: What recent negotiations have taken place between the federal government and the Ontario provincial government for the erection of 5,000 housing units in Ontario? The second question is: How many of these housing units will be erected in the Toronto area?


Hon. Roberi H. Winters (Minister of Resources and Development):: There have
been negotiations recently between the government of Ontario and us with respect to housing developments in Ontario under section 35 of the housing act. The most recent discussions were held on Tuesday, June 5, between the minister of planning and development, Mr. Griesinger, and his officials, on the one hand, and myself and the officers of Central Mortgage and Housing Corporation on the other. In reply to the second question, I can only say that so far no specific proposals have been submitted by the government of Ontario, and I am therefore not able to give the hon. member information with respect to numbers of houses involved.
7,	1951
Supply-Resources and Development


Mr. Coldwell:: As a supplementary question, is the minister aware of the situation created by the removal of tenants from Uplands airport? If so, is he co-operating with the city of Ottawa in order to find these people the accommodation that is urgently necessary?


Robert Henry Winters: I am aware of the situation, and to the best of my knowledge everything possible is being done.



INDIAN ACT


Hon. W. E. Harris (Minister of Citizenship and Immigration) moved: the second reading of and concurrence in amendments made by the Senate to Bill No. 79, respecting Indians.


Major James William Coldwell: What are the amendments?


Mr. Fulton:: Could we be told what the amendments are?


Walter Edward Harris: There are three
amendments. The first is the insertion of a comma. The second is the substitution of the word "or" for "and". The third is to strike out an unnecessary "that".


[Stage Direction]
Motion agreed to, amendments read the second time and concurred in.
[Stage Direction]
The house in committee of supply, Mr. Beaudoin in the chair.
DEPARTMENT OF RESOURCES AND DEVELOPMENT 383. Departmental administration, $381,223.
Mr. Croll:: As this is the item under which we may have a general discussion, I should like to ask the minister to make a statement on housing at this time. There are a few of us in the house who want to discuss housing, and it is a matter of great urgency.


Robert Henry Winters: I am in the hands of hon. members on that point. I am prepared to make a statement on housing. I would hope that at this stage we would be able to have the full discussion on housing and deal with the items for housing in the estimates.


Mr. Fleming:: There is a problem raised there. I think anything that will contribute toward the orderly discussion of this most important question will be desired and welcomed by the committee. There is no one item that presents as good an opportunity for that purpose as this first item. The last item in the estimates of this department relates to emergency housing. Therefore I think the first item is the one that presents the committee with the best opportunity, and

Supply-Resources and Development the earliest, for the discussion of this important question. I would) ask, Mr. Chairman, that with your approval the discussion on housing in general should proceed now.


Robert Henry Winters: I have no objection. I think it might save time in the long run if we could consider that any discussion of housing would dispose of item 427 in the estimates, and a similar item under loans and investments. If that is the understanding, I am quite prepared to proceed.


Major James William Coldwell: Of course that could only be a tentative understanding. I would agree to a tentative understanding, but, between now and the time the last item comes before us, problems may arise that members may wish to present to the committee, and I do not think they should be precluded from so doing.


The Deputy Chairman:: If the main interest of hon. members at this point is to discuss housing on the first item, which relates to departmental administration, perhaps the suggestion made by the minister could be dealt with, namely, to consider that the specific item pertaining to housing is also before the committee at the same time. Therefore when the general discussion is over on housing, I might be permitted to call the specific item relating to housing and ask that it carry. Is that agreeable to the committee?


Donald Methuen Fleming: It is understood, then, that you will call those specific items, Mr. Chairman, when it appears that the general discussion on housing has reached its end?


Louis-René Beaudoin: I am trying to say that when the general discussion on housing is completed I will call the specific item relating to housing and ask if it is carried, so that we will not have a duplication of the discussion.


Mr. Knowles:: Since we want to discuss housing I suggest that item 383 be permitted to stand and that item 427 be called. Then we can have our discussion on housing.


Robert Henry Winters: That is satisfactory.


Louis-René Beaudoin: If that is agreeable to hon. members I will do so.


Some hon. Members:: Agreed.
Item stands.
Housing-
427. Emergency shelter administration, $250,000.


Robert Henry Winters: Perhaps I should begin with a statement about the present and future prospects for housing, and should say something about government activities in the housing field.

At the beginning of 1950 there were 59,503 houses under construction. In the course of the year 89,015 new houses were completed. In all, counting conversions, 91,754 were added to our stock of housing. There were 60,538 under construction on January 1 of this year. The total expenditure on these 150,000 houses that were under construction at one time or another during the year was about $836 million. Fifty per cent of the money came from the personal resources of the property owners. This represents cash investment both as equity in properties financed with mortgage assistance and full cash investments in properties purchased without mortgage financing. Institutional lenders furnished 25 per cent of the total, and other lenders 5 per cent; the remaining 20 per cent came from public funds either as loans or as expenditure by government on housing built on government account. There has been an increase in the proportion of new housing starts which contain some element of government assistance in the form of direct loans, joint loans or guarantees. In 1950, 47 per cent of all residential starts had such public assistance, as compared with 38 per cent in 1949 and 31 per cent in 1948. In units the comparison is 44,552 units in 1950, 35,354 in 1949, and 29,035 in 1948.
Canada has completed some 460,000 new units since 1944. This is an outstanding accomplishment which compares favourably with that of any other country in the world. But many more houses are still needed. The ratio of front doors to families has not improved greatly over the last several years. In the years 1939 to 1946, and again in 1948, the net family formation rate exceeded the number of houses built. In 1947 housing completions had a slight margin of about 4,000 units. In the last two years family formation declined and housing completions increased to the extent that we had a net margin of about 40,000 units.
Building costs which tended to level off in 1949 and early 1950 have been climbing steadily since last May. Cost increases, of course, make it more difficult for prospective home owners to meet the current equity requirements.
Last year the material supply situation for the construction industry was better than for many years. It is true that last summer, because of hydro and other construction programs, there were spot shortages of cement. However, almost right up to the end of the year there were no difficulties in supply except for a few spot shortages. Production of nearly all building materials reached! an all time high in 1950. We expected that material difficulties which were spotty last winter would rapidly become

more general as the defence construction program got under way. There was the danger that houses would be started which could not be completed. I am happy, however, that as yet material shortages have not interfered as greatly with house builders' operations as was expected. Continued high level of production of most materials has maintained supplies to the point where, with a little shopping around and some substitutions, builders are able to meet their requirements. Some builders of larger projects are finding their production schedules hampered by difficulty in maintaining a smooth flow of material. Although the situation on materials is in general fairly satisfactory, there are some real difficulties. Steel sheets and pipe and other metal materials are very scarce. Even if there is an abundance of all other materials, a shortage of sheet metal for furnaces, or pipe for plumbing, can cripple our housing program.
Two other problems relating to housing development are present in most localities. The first is a shortage of serviced land. With today's costs, both in general administration and in land development, many municipalities have difficulty in finding ways and means to finance the servicing of fringe areas to provide land for residential building. In those cities where residential areas are developed there is the second and resulting problem of providing educational facilities. This problem is particularly onerous in the newly expanded suburban municipalities where the assessment roll is largely residential property and where the householders are for the most part young couples bringing up families. With today's costs, building, equipping and maintaining the required additional schools places a serious financial problem before municipal and provincial governments.
Through the first four months of 1951 housing activity has kept up pretty well to the 1950 level. New housing starts in municipalities of 5,000 and over, at 13,847 are only 1J per cent below last year. Completions at 20,849 are up 18-7 per cent. On April 30 there were 33,943 houses under construction, or 2-7 per cent more than one year ago. Now, starts and completions in the first four months are not necessarily a sound guide to the year's performance, but it seems likely that in 1951 housing completions will come reasonably close to the 1950 mark. If those houses under construction at the beginning of the year, and those started before May 1 are completed, 1951 completions will be 85 per cent of 1950's but if the rate of new starts is maintained at near the 1950 level in May and June, we will come even closer to the 1950 mark.
7, 1951
Supply-Resources and Development
In the first four months of this year 8,436 joint loans for 10,148 units were approved under the National Housing Act. This compares with 8,916 loans for 10,147 units in the same period in 1950. However, the loan approvals in April were fewer than in April, 1950. In April, 1951, 2,533 joint loans were approved in respect of 3,141 units, as compared with 3,198 loans on 3,639 units in April, 1950.
There are some real obstacles in the way of maintaining this level of housing activity. As well as the difficulties of an insufficient supply of serviced land, increasing building costs and a tightening of mortgage money, there is the possibility that the material supply situation will tighten. I spoke a few minutes ago about the shortage of steel sheets, pipe and other metal house components which is even now causing some difficulty. Even though there is every prospect of increasing the overall capacity of our construction industry, and notwithstanding the curtailment of some commercial construction because of the steel regulations and deferred depreciation, it may well be that house building will feel more general shortages before the end of the year. The defence program includes a substantial amount of new construction, and I think it unreasonable to expect that the construction industry can take the additional very heavy load of defence construction without a cut being made in other types of construction. It is likely that the house builder will be hardest hit when building materials in large quantities are channelled into defence construction. The probable curtailment of commercial construction will tend to reduce the competition to house builders. Perhaps the effect will be sufficient to compensate fully for the diversion of materials into defence construction.
As I said previously, Canada's accomplishments in the field of housing since the war rank us high among all nations in house production per capita. The standard of housing in Canada compares favourably with that of any other country. The housing shortage is general throughout the world, and in fact it is more severe in nearly all other countries than it is here. We sometimes hear it suggested that somewhere there is someone with an almost magic formula of new materials and methods which will produce the low cost house to end all housing problems. Perhaps some day there will be such a development. A method which would produce satisfactory housing under today's conditions at about half present costs, or say $4 or $5 per square foot, would provide a happy solution to many housing problems. Research toward this end is being carried on, not only in Canada,
3798	HOUSE OF
Supply-Resources and Development out also in many other countries throughout the world, but as yet only minor advances have been reported. Most of the developments so far have been in the nature of improvement in methods and materials. These improvements have not resulted in lower costs, but rather they have tended to give us a better house at about the same cost. The standard of house demanded by the Canadian housewife-and it is the housewife who in large measure determines our housing standards-continues to show an upward trend. If Canadian householders were willing to accept housing of the standard and pattern of the 1920's, about 15 per cent more houses could be built for the money now being spent.
The degree to which our housing stock can be increased through the next few years will be determined to an important extent by how much we are required to commit to the defence program. Housing as a whole is a part of the civilian economy. There must be general agreement that substantial expenditure on defence preparations must be accompanied by a reduction of spending in other fields. However, we have stated that the government attaches a high order of importance to housing and will emphasize it to a degree second only to the direct defence program itself. We will continue to make every effort to see that housing is built in the areas where it is most needed.
In September, 1949, the National Housing Act was amended by the addition of section 35. This section provided a method by which all levels of government may participate in public housing. Central Mortgage and Housing Corporation may, pursuant to agreements between the government of Canada and the government of any province, join with a provincial government or its agent in projects for the development of land and housing purposes or for the construction of houses for sale or rent. Capital cost and profits and losses are shared 75 per cent by the corporation and 25 per cent by the provincial authority. It is left to the province to decide whether a part of the province's share is to be borne by the municipal government.
After section 35 was adopted, it was necessary for a provincial government to adopt complementary legislation before any agreements could be concluded. It was well into 1950 before any of the provinces were able to pass such legislation. During that year seven of the provinces-Ontario, Quebec, New Brunswick, British Columbia, Manitoba, Saskatchewan and Newfoundland-enacted complementary legislation. Nova Scotia followed suit this year.
I Mr. Winters.l

Although it was well into 1950 before agreements were concluded with any of the provinces, some worth-while progress has been made in one year's operation. Newfoundland was the first province to enter into an agreement with the federal government for housing under this section. A rental housing project of 140 units is now almost complete in St. John's, and a land assembly project to provide some 600 building lots is under way. In Saint John, N.B., tenders have been called on a project of 88 low-rental units and a land assembly project is under discussion. In Ontario activity to date has been limited to land assembly. Projects involving a total of over 600 acres are under way in London, Windsor, Ottawa, St. Thomas, Kingston, and Atikokan. There have been recent discussions between the government of Ontario and the federal government about the possibility of expanding operations under this section, and we expect that before too long we shall receive specific proposals from them.
Several proposals are under active consideration by the province of Saskatchewan. An agreement has been reached with the province of British Columbia in respect of a 200 unit low rental project at Little Mountain in Vancouver now out to bid.
I am not too sure how extensive the dominion-provincial program will be in the immediate future. All the difficulties inherent in the over-all situation are present in public housing projects. In addition to possible difficulties in the supply of labour and materials, there is the very serious question of building costs. I am not at all sure that today's costs will permit the construction of rental housing that is truly low rental in character. This may well have to be found by the partners concerned.
Section 35 has the merit of enabling the various levels of government to act together in a direct way to place housing where it is urgently needed. I believe it will be generally agreed that public housing under this section should normally be contemplated only in the larger centres of population. Although we are not pleased at the prospect of public housing projects competing with private builders and operators for available building materials, we are willing to consider any firm proposals the provinces may advance for housing projects under section 35, especially in areas where the defence program has aggravated the housing shortage. If it appears that a project can be completed in a reasonable time at not too excessive cost, we will be willing to proceed. However, it is not our intention to enter into projects under section 35 where occupancy

will be limited to those higher income families whose needs are normally met by private house builders. We wish to avoid entering into competition with the building industry especially in the range of economic housing.
The construction program of Wartime Housing Limited, the veterans rental housing program, and the houses constructed by Housing Enterprises Limited which were later taken over by Central Mortgage and Housing Corporation, have resulted in some 53,000 rental housing units being owned by Central Mortgage and Housing Corporation at one time or another. Over 30,600 of these houses have been offered for sale. To date, a total of 20,700 have been sold. Sales are running at a good rate, and I would guess that by the end of the summer at least 4,500 more will be sold. For the most part these houses are sold to veteran tenants. One hundred and sixty-four have been sold for removal from site, and 2,126 have been sold en bloc to municipal governments.
It is to be remembered that these houses are not sold in the open market but that the tenant has first opportunity to purchase. If a tenant is unwilling or unable to buy, normally he may continue to occupy the house as a tenant. There are a few cases from time to time where a tenant who does not intend to purchase is requested to move to another house owned by the corporation in the same area to make his house available to a veteran purchaser. Houses which have been rented and which become vacant are not rented again but are held for sale to a veteran applicant. The sales program is going very well indeed, and the corporation's position as Canada's largest landlord is being steadily reduced. The reduction in the corporation's real estate account is, of course, offset by a corresponding increase in its mortgage and sale agreement portfolio.
There are two items in the estimates dealing with housing. One-an item under loans and investments in the amount of $12,700,000 -is to provide funds which may be borrowed by Central Mortgage and Housing Corporation under section 34 of the National Housing Act, 1944. This sum is required to complete housing projects under the 1949 veterans' rental housing program and a project at Deep River, Ontario; for financing permanent Improvements to munition workers' houses now under sale, and for the construction of additional houses at Deep River. On April 1 there were 621 houses under construction in the projects still to be completed; permanent improvements were under way on 752 houses. A project which will add 200 houses at Deep River will be started under the 1951 program.
Supply-Resources and Development
The other, an item in the departmental estimates for emergency shelter administration in the amount of $250,000, is to provide for administration costs and operating deficits in connection with emergency shelter projects operated by Central Mortgage and Housing Corporation, and to meet restoration costs connected with the closing out of emergency shelter projects. Considerable progress has been made in closing out projects operated by the corporation, universities and municipalities. We have every hope that 1951 will see many more of these projects closed or reduced.
It is difficult to forecast the prospects for housing in 1952 and 1953 with much certainty. Conditions have been changing from day to day, and the opinions of today may well be altered by the developments of tomorrow.
However, it is apparent that -many of the conditions now present are unfavourable to an increased volume of housing. Indeed, the big problem may be to prevent the present volume from being decreased to the full extent of the unfavourable conditions we are now encountering.
Construction costs have increased about 15 per cent in the last 'year. This means that the same size house is now available only to individuals whose income is approximately 15 per cent higher than the people who bought or rented this type of house a year ago. I cannot see that increasing the level of National Housing Act loans to meet these higher costs would be a solution. Such higher loans would add to the pressure on housing costs. Furthermore, the higher the mortgage loan, the higher the monthly payment. It is for this reason that we have held firmly to our January 1950 level of lending values. Moreover, even under present conditions houses are being built and occupied to the full extent of available mortgage funds. It would seem prudent, therefore, to aim at spreading available mortgage money over as wide a number of new houses as possible, thereby encouraging maximum production. Although the high down payment is an obstacle and an initial hardship on the home owner who must himself finance the increase in cost, I believe it is better than encouraging him to assume debt service costs beyond his means.
Earlier this year increases in interest rates made lending institutions increasingly unwilling to lend money for mortgage purposes under the National Housing Act. It seemed to be in the interest of housing and the public generally to have the terms of this act remain operative. Accordingly, I announced the government's intention to increase interest rates, and I am hopeful that the increase to be permitted under the National Housing Act,
3800	HOUSE OF
Supply-Resources and Development to which I referred earlier in the house, will assist in maintaining the flow of mortgage money at a good level. An amendment to deal with this proposal will be before the house shortly.
As I said earlier, it seems possible that in 1951 we will complete about the same number of houses as we did in 1950. However, current conditions may well reflect themselves most clearly in a reduction in the carry-over of houses under construction into 1952. I would not wish to hazard a forecast from this distance of what our 1951 carryover will be.
The government recognizes the need for iiousing, and, as far as present circumstances permit, we are doing everything to keep house building at a high level. We will pay particular attention to the communities where housing is most needed. Because defence production is the main effort of the country today the government is anxious to do everything it can to meet the housing needs in defence production areas.


Donald Methuen Fleming: Mr. Chairman, I am sure the committee will be glad to have this opportunity to debate the whole housing situation in Canada. It is anomalous, it seems to me, that this problem, which is still so serious, has received relatively little attention in the debates in the house at the present session. On two occasions the minister made statements containing announcements of change of policy on the part of the government, but they were made under circumstances which precluded debate. I think you will agree, sir, that this is the first occasion on which the house at the present session-although we have been in session now for something like four and a half months-has had an opportunity of expressing itself with regard to the housing situation in general.
The committee will appreciate the full statement which has been made by the minister this afternoon. The committee is glad to have information which, in the up-to-date form in which it was given to the committee by the minister, had not been previously issued in' complete form in any of the publications under government auspices.
There are some features in the situation which are not altogether dark, Mr. Chairman. Nevertheless I think that the general tone and effect of the minister's statement today is such as to leave us with a rather gloomy outlook in regard to the possibility of meeting the serious housing situation that still prevails in Canada. There are several factors that, as I think the committee will recognize at once, inevitably present difficulties. The first of these is the shortage of materials. The minister has indicated that


shortage of materials has not as yet been seriously retarding house construction. I do not know how general that experience has been. I think that a good many builders- certainly those in the larger civic areas where housing conditions are so difficult-have been experiencing difficulties on account of shortages of materials. I am disposed to think that the picture in Canada is not nearly as bright in that respect as the minister's statement this afternoon might have been taken by some to indicate. I do not think the minister has adequately recognized the problem that the builders of the country are facing with respect to shortages of needed building materials.
The picture as to building costs is likewise growing more serious. The daily bulletin of the dominion bureau of statistics of May 23 draws attention to the rise in the price index of general and residential building materials. It gives these figures:
Wholesale prices of both general and residential building materials moved to higher levels in April, according to index numbers compiled by the dominion bureau of statistics. The index for general building materials advanced to 293-9 from 291-5 in March and 234-5 in April last year, and for residential building materials it rose to 237-2 from 282-6 in March and 227 a year earlier.
Just think what that means, Mr. Chairman, in terms of building costs. Since last we had an effective opportunity for debate on this question in the house a year ago, the costs of residential building materials has risen from 227 to 287 [DOT] 2. That is an alarming increase. Moreover that increase in the cost of materials has been paralleled, if indeed not outdistanced, by the rise in building labour costs. The situation with respect to the cost of building therefore presents a serious picture indeed, and it is not one which is likely to warrant any great optimism on the part of the minister or anyone facing this problem in its serious aspects.
Notwithstanding the increase in the cost of building materials and of labour costs, construction in 1950 in Canada-I am speaking now of the total volume of construction of all kinds-reached an all-time high. Figures which I saw this week have indicated that the volume of construction-these figures come from the records of construction associations-so far this year is likely to be above last year. Taking out of that the portion relating to housing, I think it is evident that there is very serious competition in Canada today for a quite inadequate supply of building materials, and in that competition housing construction is beginning to suffer, and will increasingly suffer from this point on in competition with other forms of demand for building materials

and building labour. On these various accounts, Mr. Chairman, I think it must be recognized that the housing situation still has to be measured in terms of critical proportions. It is no exaggeration to say that we still have a housing crisis in Canada.
The mayors of this country met in Montreal in February last at the annual meeting of the Canadian Federation of Mayors and Municipalities. At that meeting these municipal officials, the heads of their municipalities from coast to coast, people who are in the closest possible contact with housing problems in all their ramifications in all parts of Canada, said that housing is the No. 1 problem in Canada, still the No. 1 problem. They went on to express views with respect to the housing situation in Canada in which they indicated alarm over the situation as it has been developed.
That is the expression of a representative group than whom I think there is no group in the Dominion of Canada who are closer to this problem. We have similar statements as well following recent announcements on the part of the government as to changes in housing policy, which give expression to alarm as to the effect of these changes in government policy. I hope to have an opportunity of referring to them later in my remarks.
These are serious problems. These developments to which I have referred are developments that underline not only the fact that we have a continuing housing problem, but that that housing problem is likely to be reflected in reduction in the rate of construction, while at the same time the demand for housing increases apace.
It is evident that the government must give some thought to deciding what are the most important demands for available material. It is evident that it will not be enough for the government simply to be content to allow a situation of this kind- I am speaking particularly of building materials-to take care of itself, because in the competition that is going on for that inadequate supply of building materials housing is losing out, and the figures show that to be increasingly the fact.
Against that background what are we to say of government policy as it has been unfolded at this present session? I think it is fair to say there have been three stages of the development of government housing policy in the lifetime of the present parliament. The first, of course, was in the fall of
1949.	We all well remember that the government had made unqualified promises in the election campaign about the measures that
Supply-Resources and Development they were going to take to cure the housing problem. One might have thought that the people of Canada had had sufficient experience by that time of the way in which the government had failed to measure up to promises. Nevertheless, apparently the people of Canada took those lavish election promises at their face value.
In the fall session of 1949 we looked for at least a measure of performance of the promises. Well, you will recall, Mr. Chairman, that early in the fall session the minister made a statement in which great emphasis was put upon the fact that the government was going to increase mortgages by one-sixth, and this was going to be very effective in meeting the problems of those who did not have sufficient funds to make the down payment then required as between the prevailing cost of houses on the one hand and the amount available under National Housing Act mortgages on the other, and so with loud trumpetings this new policy was introduced and found its way into the act. You will recall that at that time some of us pointed out that if the government chose to do so it could largely nullify the effect of the lending provisions of the act by holding down the approved lending value of properties. After all, there is not much sense in talking about increasing the mortgages by one-sixth, if in fact you are working under the same total percentage of lending value and you set about to hold lending values down till they are quite out of keeping with actual increases in property values and prices. And, sir, that is exactly what happened.
It was not very long before the government undertook-and, if you please, deliberately-to reduce the benefits that they had held out to the people of Canada as likely to flow from the 1949 amendments, and by this new housing policy they deliberately held down lending values. You will remember that as of January 1, 1950, in effect the government through its agency froze lending values, and, from that time to this, lending values have, so far as the government is concerned, remained frozen, notwithstanding the continued increase in the prices of residential property and the increases in the costs of construction.
Well, that was the first step on the part of the government-and a very weighty step it was, too-in nullifying the effect of the 1949 amendment of the housing act. That, sir, had some other serious aspects to it, in this respect: that in Ontario the government of that province had previously been in the field of second mortgage loans in order to assist intending house builders in meeting that very serious problem of the spread between the mortgage allowed under the
3802	HOUSE OF
Supply-Resources and Development National Housing Act and the prices at which houses, were being constructed. As a matter of fact, the Ontario plan was much more favourable to house construction than was the federal plan, because the rate of interest in Ontario on second mortgages was just 3J per cent, whereas the rate of interest applied by the federal government through its agency to the additional one-sixth loan under the 1949 amendment was 4J per cent. But the government of Ontario, relying in good faith upon this bland assurance of the federal government, and upon the enactment by parliament in November, 1949, of the amendments to the act, had only one course open to it in this respect, and that was to step out of the field of second mortgages. Accordingly it did so.
Theoretically the dominion stepped in. But, Mr. Chairman, it just got its toe wedged inside the door far enough to oust the government of Ontario and its progressive plan of assistance, and then it proceeded to withdraw that foot by steady degrees. And so we have seen, in effect, a nullification-perhaps not a complete nullification, but at least a substantial measure of nullification-on the part of the government opposite of the intent of parliament as reflected in its enactment of amendments to the housing act in November of 1949.
That was regrettable enough. Surely that was a heavy enough burden to cast upon the people of this country. Particularly is that true when applied to the younger people setting up homes, who just have not had the opportunity in the face of the high cost of living, to set aside enough money to provide for that spread between the cost of house construction on the one hand and National Housing Act mortgages on the other.
The next backward step taken by the federal government, the next step taken by this government to nullify the enactment of parliament, to defeat the wishes of parliament and to break faith with the people of Canada in the light of the promises made to them during the election campaign of two years ago, was taken in February of this year.
Hon. members will recall the statement made by the minister on February 5, when he announced in the house that, effective at once, the federal government was withdrawing the one-sixth additional mortgage provision. Immediately that statement was accompanied by some veiled suggestions that the move was temporary. But if it is temporary, at least it has been in effect now for four months. Although hon. members have tried to drag a statement from the minister as to when this temporary policy will have run its course, they have been met with the stock and stale fMr. Fleming.]

answer, an answer which has been worn to death in the house by members of the government who say: "That is a matter of government policy upon which announcement will be made in due course."
This announcement of breach of faith the minister made on February 5 has already been in effect for four months, and there has not been the slightest indication from the government opposite of any change of heart or any intention of bringing to an end this measure that they suggested, in a veiled way, was to be only temporary in its effect.
Mark you, that step was taken by the government opposite without the slightest consultation with parliament. They had no authority from parliament to tear up section 35 of the act. That was an enactment of the parliament of Canada. But the government opposite simply says, "We are going to reduce-"


Robert Henry Winters: I think perhaps I should correct the hon. member. Section 35 is not involved in this one-sixth arrangement at all.


Donald Methuen Fleming: I misquoted the section; I am sorry. I meant section 4, but the number is not the important thing.


Robert Henry Winters: That is right.


Donald Methuen Fleming: The important thing right now is that the government nullified the section without any consultation with parliament. There was no such thing as coming before parliament and so much as asking "by your leave"; none of that at all. The government simply said, in effect: We are stopping from this time forward the effect of the 1949 amendment of the act; there will be no more one-sixth additions to the loans. Why? It was not because parliament said they should stop; it was because the government said they should stop.
Is anyone going to rise in this chamber and say that was the will of parliament? I do not believe it is the will of Liberal members from Toronto. Nevertheless this government, not caring what had been said in parliament in 1949, and apparently not caring what they said to the people of Canada when they sought their votes two years ago, just decided that, notwithstanding the fact that parliament had enacted these new provisions in 1949, it would have the effrontery to step in and say: That enactment of parliament becomes a dead letter from this date forward, and will remain a dead letter until we, the government, decide that it shall be revived.
Mr. Chairman, is the House of Commons going to accept treatment like that from the government in respect of legislation it enacted

in good faith in 1949? If the house is prepared to see its legislation torn up and scattered to the four winds in that way, simply because the government decides to do so, then we are all of us just wasting our time here. It is only a waste of time for us to legislate if our legislation is thus to be nullified by the government opposite.
I said there were three stages to the development of government policy-or perhaps one might more accurately describe it as a retreat from government promises. The third step was taken on May 11 of this year. We know that from the time the National Housing Act was enacted in 1944 that act held out much of its effective promise through the simple fact that the rate of interest on loans was, while I will not say low, still very reasonable. It was a rate somewhat below the normal market rate.
There have been occasions on which the government has been asked, with a measure of justification, to reduce that rate in order to give greater encouragement to house construction. But whether the government was right or wrong in maintaining that rate through those intervening years, is anyone going to justify now the increase in the rate? It is true that the prevailing market rates on mortgage loans have risen; there has been a general increase in interest rates within the last four months. Unquestionably the mortgage market has been affected by that fact. But while this increase in the rate of interest on National Housing Act mortgage loans is not in my opinion going to be as serious in its effect upon house construction as the other step to which I have referred, nevertheless it is likely to have some effect.
It is not going to be, as I have indicated so far as my opinion is concerned, as serious in its effect as the step taken to reduce the lending value, to nullify the provision of the one-sixth additional loan, but nevertheless these are all going to have their cumulative effects.
What has been the effect of these changes in government housing policy, these retreats on the part of the government from its promises and from the intent of parliament? I have a Canadian Press dispatch of February 19 from Montreal, which reads:
F. A. Mager, president of the National House Builders' Association, said today that Canada's housing shortage will get worse, not better, in the coming year. In his annual report to the association convention, Mr. Mager said curtailment of the National Housing Act by eliminating the "additional one-sixth loan" is an "alarming move." He said this will make down payments $1,000 more than at present on five-room houses, and $1,500 on six-room houses. "I say the greatest bulwark we can
7, 1951
Supply-Resources and Development erect against the inroads of communism will be to extend the facilities of home ownership to an ever widening segment of our population," he said.
This step naturally was of great concern in the province of Ontario where, as I have already indicated, the government of that province, having been in the field of second mortgage loans, had vacated that field in favour of the dominion when parliament in November, 1949, enacted those loudly trumpeted amendments to the act. The grave concern of the people of Ontario was reflected in a statement made by the premier of the province in the legislature following the announcement of the minister of February 5 when he told this house in effect that the government had repealed an enactment of parliament with respect to the provision of the one-sixth additional loan. Premier Frost in the legislature, and I may say with general approval on the part of all parties represented therein, expressed his entire disagreement with the move which had thus been announced by the federal government. He said: "Of all things to be cut back, housing should be the last."
So far as I am concerned, apart from those things that must be done to meet the immediate and critical demands of the rearmament program-and I am speaking there of only the critical and immediate needs in that respect-certainly there can be no qualification whatever of the view here expressed by Premier Frost, a view that I am sure is shared by the people of Canada-


Mr. Benidickson:: Why does he not restore second mortgages?


Donald Methuen Fleming: -that of all things to be cut back housing should be the last. Here we are in June faced, I think, with a situation that is likely to be reflected in a further diminution of the rate of construction of houses, with higher costs of construction, and, so far as one can see in the minister's statement, no effective measures being concerted by the government to meet the situation. It is undeniable that right now there are thousands of families in this country who, if the one-sixth mortgage provision had not been withdrawn in February last, would have been prepared this year to take advantage of it but who, by reason of this backward step on the part of the government, have now been deprived of any opportunity of acquiring homes under present conditions. I think you are going to see, because of the elimination of that large and necessitous group from the effective market for new houses, a curtailment in house construction. You are going to see far more need with
3804	HOUSE OF
Supply-Resources and Development respect to housing, far more distress with respect to housing conditions than has been the case for some time.
At a time like this with inflation going on and nothing effective being done by the government to stop it, with a moderate expansion in population, and with obsolescence always a factor in connection with housing, we are not likely, apart from effective and concerted measures, to see anything very significant done under present conditions to alleviate what has again become a growing problem. It seems quite evident to me that the first effective step that the government ought to take is to restore to its full vigor the legislation that parliament enacted in 1949 to meet just such a situation as we are confronted with now.
That is the first step, and it is a step that is long overdue. Let the minister come forward now and say that the policy announced on February 5, which was then said to be temporary, was in fact temporary, that it is at an end now and that parliament's enactments are going to be given their full effect and are going to be restored to full vigour.


Mr. Carroll:: Does the hon. member say there is a special section of this act which has been torn to shreds or does he suggest that the whole act has been?


Donald Methuen Fleming: I am referring to the 1949 amendments. The hon. member will recall the amendments parliament enacted in 1949, the most important one of which was to provide for the additional one-sixth on mortgage loans authorized by the act. That is the provision which the government nullified as announced in the house on February 5.
It seems to me, as I have indicated, that the first step the government should take now is to restore the 1949 amendments to their full vigour and effect. If I may say this in all frankness to the minister, I think that we all know that the minister has a cooperative attitude. He is not one of the ministers who are hard to get along with. He is the sort of minister who, we hope, will be able to co-operate fully with the provinces in working out schemes of mutual interest and advantage to meet housing conditions, particularly in areas where they are so acute.
The rate of growth in some of our urban areas in recent years, and even more particularly in recent months, has been little short of prodigious. The growth in greater Toronto, for instance, has been at a literally amazing rate, but the housing problem in Toronto has not grown any less severe even with the very extraordinary development of housing construction in the greater Toronto


area. With the continuing influx of population into our larger centres, unless we have something more to look forward to than the statement made by the minister today and the barren results of these retreats in government housing policy, it will be necessary for this house to go on demanding on the part of the government some effective appreciation of the seriousness of the situation and effective action to meet it. What is required first of all is a sense of reality on the part of the government in appreciating the seriousness of this situation, and then courage to retrace its steps at least back to last February 5 and restore the provisions of the 1949 amendments.
Then, Mr. Chairman, I do not know how long the government can expect, in the face of these increases in the cost of construction and the cost of residential properties, to hold lending values to the terms of January 1,
1950.	To that extent they are simply whittling down the lending provisions of the National Housing Act, quite apart from the one-sixth additional loan provided for by parliament late in 1949. It seems to me this house ought to sound a call to the government to stop nullifying the provisions parliament has enacted to meet this situation, and the government should recognize that this problem is beginning to develop even more serious proportions than have been apparent in recent months. The government should take prompt steps, in concert with the provincial and municipal authorities, to work out measures that will meet these needs where they are most acute today, but the first step must be the full restoration of the law enacted by parliament.


Mr. Thatcher:: As an opposition member,
like the hon. member for Eglinton I am afraid I am going to have to say a few sour things about this department. Before doing so, however, I want to thank the minister on behalf of the people of Saskatchewan for the co-operation he recently displayed when the provincial minister of reconstruction and social welfare was here discussing housing for Saskatchewan. The problem in that province is very severe; proportionately I believe it is just as serious as in Ontario. Several weeks ago our minister asked for 2,000 houses, I believe it was, under section 35. The Minister of Resources and Development gave him only 500; but he intimated that there was hope that we might get a few more a little later on. Thus I wish to tell -the minister we do appreciate the gesture he has made.
At the same time I think most hon. members will be a little disturbed by some of the

statements made this afternoon by the minister. He made it fairly obvious that nothing will be done again this year to catch up on the backlog of housing; and as everyone knows that backlog is very substantial. I believe it was the hon. member for Eglinton who said that a short time ago in Montreal the mayors and municipal heads said that housing was Canada's No. 1 domestic problem. I remember reading the report of Mr. Mansur, president of Central Mortgage and Housing Corporation, a short time ago, and on page 3 I found this:
Effective demand for new housing, both home ownership and rental, has never been stronger.
The reasons for this situation are obvious. A short time ago it was announced that we were going to try to bring 150,000 people to Canada in the coming year. I want to say at once that I heartily support that policy, but surely if we are going to bring those people here we should build homes in, which to place them. In addition there will be a heavy natural increase in population. Those two factors, and the defence program, have brought the housing problem to desperate proportions in many cities.
What has the government done to alleviate this abnormal demand for housing? This year it has taken a number of steps which will accentuate the crisis. The first step the minister announced was an increase in the down payment, under N.H.A., which today amounts to roughly 25 per cent of the purchase price. This means that if a working man wants to build even a small, five-room house he must have about $3,000. Not many years ago you could build a whole home for $3,000. With higher taxes and the higher cost of living, such a down payment virtually bars about 90 per cent of the people of this country from building homes. That is the effect of the provision, whether or not the minister wanted it that way. But this is not the worst feature of the present situation. For one reason or another-and I contend largely because of government policy-in many parts of Canada the insurance companies are refusing to make loans under the National Housing Act. They can lend their money in other ways and get higher returns. No doubt they are still making loans in the residential sections of Toronto, Ottawa and Montreal, but I know that in most parts of my own province and in many parts of western Canada and the maritimes the insurance companies are not making those loans today. Surely if that is the case the minister should take advantage of the provisions of the National Housing Act, which permit him to make the full loan where necessary. I
Supply-Resources and Development earnestly plead with him to do so in those areas where the insurance companies are not making loans.
The government took another step this year that bewilders me. At the very time we want more homes, Central Mortgage and Housing seems to be cutting down its building program. I think it was the hon. member for Vancouver-Quadra who stated that the Fraserview project in Vancouver had been pretty well abandoned, and there have been other instances of that kind. What does this mean? It means that at a time when people are huddled together because of an increasing shortage of dwellings, at a time when we are bringing more than 100,000 immigrants into this country, at a time when we are trying to step up defence industry, instead of building more homes we are going to build fewer. The program just does not make sense to me. Why are we curtailing our program? Last February the minister said that was being done simply because materials were not available. At page 69 of Hansard for February 5 the minister said:
. . . starts at the 1950 rate are beyond the capacity of the house-building industry under present and foreseen circumstances. Building supply materials, and particularly products of steel, are in short supply, with the result that many builders and owners are unable to complete houses.
That was the reason the minister gave us last February, but a few days ago at page 3671 of Hansard I asked the Minister of Defence Production this question:
In view of reports that housing is being held up in many sections of Canada because of lack of materials, will the minister tell us what recent steps the government has taken to see to it that housing is given adequate priorities to obtain essential building materials?
The minister made this reply:
I have had no report that housing is being held up.
Both statements cannot be right. The minister whose estimates we are now discussing told us-


David Arnold Croll: Would the hon. member read the second question and answer, just to give the committee the continuity?


Wilbert Ross Thatcher: Which?


David Arnold Croll: The hon. member followed that up with a second question on the same page.


Wilbert Ross Thatcher: I will be glad to put the next question on Hansard also:
I should like to ask a supplementary question . . . Does his department give specific priorities to housing projects for the purpose of getting building material?


Mr. Howe:: No, Mr. Speaker; there is no specific
priority-
3SC6

Supply-Resources and Development That is one of the points I am coming to. -but certainly there is a working arrangement with my colleague the Minister of Resources and1 Development for priority assistance in building houses, where that assistance is required.
There is a working arrangement, but the Minister of Defence Production stated categorically that there is no special priority. I remember the Prime Minister telling us a short time ago that housing was to have a very special priority. I think he said it was No. 2, after defence. If there is any priority in housing today I have not been able to find any indication of it, nor have any of the builders in my particular riding.
We in this group are conscious of the needs of the defence industries. We think that everything should be done to facilitate and make the defence program a success. But we also say that in peacetime, while there is no major war, only defence industries of the most critical nature should be given priority over housing. Most of the houses which have not been finished to date are being held up possibly because they cannot get steel or cement. Surely it is sensible that the minister whose estimates we are now discussing should go to the Minister of Defence Production and demand that he be given the necessary priorities, so that materials can be made available.
This group has a number of specific recommendations that we would make to the minister in the hope that he would carry them out. One of the main criticisms that I have had in any talks I have had with the minister is that he is too prone to depend upon private enterprise to carry out his program. If he were more willing to go along with his own department, and with state-owned construction, we might make a little more progress. I cannot help but think of some of the promises my hon. friends opposite made in 1945. Here is one of the pamphlets in which they said: New housing plan.
I am going to quote from it:
. . . more and better homes for hundreds of thousands of families. It means closing the present gap between our housing needs and the number of homes available.
Then they promised that houses would be available for a payment of as low as $13.82 per month. There are not very many of those in Canada today. Before the 1945 election every government spokesman promised that returning veterans would be given proper homes.
The C.C.F. program is fourfold. We suggest these specific points to cope with the housing crisis. First, let Central Mortgage and Housing Corporation or some other government agency immediately undertake a 

large-scale building program of low cost houses to be sold or rented to Canadians in the lower income brackets. Second, let housing be given a top priority for the obtaining of essential materials, second only to urgent defence projects. Third, let down payments and credit terms generally under the National Housing Act be relaxed to encourage private building. Fourth, in localities where insurance companies will not lend money under the National Housing Act, let the government step into the field and provide the total National Housing Act loan.
Mr. Chairman, the minister stated a few minutes ago that the amount of money which was available for housing mortgages was limited. Then surely the time has come for the government to increase the amount of money available for mortgages of that type. I believe this year we are spending $3 -7 billion. I say that to meet this problem the government must find a little more money, not to spend heedlessly, but to invest in the Health and comfort of our people, to invest in a way that cannot be measured in dollars or cents.


Mr. Johnston:: Mr. Chairman, I wish to
say a few words at this time concerning this subject. I do not intend to take very long. I want to say to the minister that since he has been the head of this department there has been a great deal more satisfaction in the construction of houses than there was previously. It is an important problem, and one in which I believe every member of this house should take his responsibility. It seems to me that, from a national point of view, there is nothing that could be developed in this country that would bring greater satisfaction, greater comfort to the people of Canada, than properly built homes. The idea of having the dominion government continue in the field of building homes is questionable. The hon. member who just preceded me thought that greater emphasis should be placed on socially constructed homes, as I believe he called it. I take it from that that what he had in mind was that the government itself should proceed with a much greater program for building homes.
I am not sure, Mr. Chairman, that that is a wise procedure. In the past we have had a great deal of experience with the government building homes. I must congratulate the present minister on getting out from under some of those difficulties. It is true that he has passed the buck to the provinces, and the provinces are going to find a great deal of difficulty with it if they embark on a large-scale home building plan. One of the greatest difficulties the federal government has had in building homes has been the proper supervision of construction. They

have had specific plans with detailed specifications drawn up, but invariably those specifications were not lived up to, solely because the inspectors who were employed fell down on the job. I have always recognized that the government could not personally supervise every house that is constructed across Canada. It is an utter impossibility. They must depend, therefore, upon the inspectors whom they appoint. I am sorry to say this, but I must say that I believe a great number of the inspectors were appointed more from a political point of view than from the standpoint of their ability. That is one of the reasons why there was such poor construction.


Robert Henry Winters: Oh, no.


Charles Edward Johnston: The minister will say that
is not right, but if he looks over the record of some of his inspectors he will find it is so. I could mention some, but we do not want to mention names.
No matter who undertakes that job, whether it is the federal or provincial government, difficulty will be experienced in that same field. It seems to me that the plan that the government has announced it intends to follow in regard to the building of homes is going to make it much more difficult for the people to get homes, particularly the stand which the government is taking in the raising of interest rates. As we all know the rates have been increased. The government is going to assume twenty-five per cent of the loan and the lending company is going to be guaranteed against losses to the extent of twenty-five per cent. It comes to this point, Mr. Chairman, that when the national housing plan was started the lending companies had great difficulty in finding any field in which they could safely lend their money. During and after the war, especially in the west, a great many people who were in debt to mortgage companies managed to get out from under that burden. When the housing project started, that opened an excellent field for the lending companies. They could not have had a safer project because they were guaranteed against loss up to twenty-five per cent. In fact, I do not believe the lending companies have lost one cent under this plan. The government has lost a little, but not too much.
When the lending companies have such an assured protection that there is no possible chance of a loss, or extremely little chance as experience has proven over the last number of years, why should we be asked to give consent to allowing the mortgage companies to raise the interest rate from five per cent to five and a half per cent on 80709-242
Supply-Resources and Development their share of the loan? The other day when I was reading the Financial Post, my attention was drawn to this part of the article which appeared on Friday, May 18,
1951.	The heading was:
Ottawa Raises National Housing Loan Rate to Five Per Cent
-Return to Lending Institutions to be 5J per cent- Only Slight Deterrent to Home Building
This was the part that I was attracted by:
Lending Institutions Tight
Prevalent opinion expressed by trust, insurance, and mortgage companies is doubt whether the scope of operations can be maintained at the high level of 1950, the higher return in interest notwithstanding. They point out that they are simply short of funds for the time being; that they have still heavy forward commitments from 1950 . . .
From that it would appear that the reason the mortgage companies want to raise their interest rates is not that the investment is not secure but that they are getting a little tight in their loans of money. They are not now anxious to lend in this field because they can lend their money in other fields and get a greater return. But mind you, Mr. Chairman, they were not so much concerned about that when there were no other fields available for them in which to lend their money at higher rates of interest. They were mighty glad to take advantage of this field and lend their money at 5 per cent, which was a mighty good rate of interest in anybody's language. Certainly when you compare that field of investment available to the mortgage companies with the field of investment available to the private individual, you find that they stand to have a great advantage. What field is there for the ordinary man in which to invest his money and get 5 per cent or 5J per cent return? Certainly the government does not provide that opportunity. Even if the individual invests in government bonds he gets 3 per cent or less now, if he wants to cash those bonds. It seems to me that when we add that increased interest rate to the already high cost of building, the thing is getting out of all reasonable proportions.
We must recognize the fact that these builders of homes are faced with other problems in addition to that of increased interest rates. There is the cost of material. As has been pointed out, the cost of material has increased greatly. The home that we used to build, when this plan first started, at about $6,000 now costs in the neighbourhood of $9,000. The cost of labour has increased; and it has increased directly as a result of the increased cost of living, in respect of which this government has played a major part.

Supply*-Resources and Development
Then the down payment, as it existed in 1949, has been withdrawn. Just where is the ordinary man going to get the money to finance the building of a home? It just is not there. Under the present program which the government proposes to put before the house, they are going to make it that much more difficult for any private individual to build a home.


Mr. Shaw:: It will be impossible.


Charles Edward Johnston: As the hon. member for
Red Deer says, it is going to be impossible for him. Surely the government should be taking the lead in trying to induce home building. It should take that step by lowering the financial cost of construction as much as possible.
If there is a shortage of material-and without question there is such a shortage- then there should be a proper rationing system. If the defence program needs the first priority on those materials, it should get it; but I think that housing should come next. Priority should be given to home building. In my locality a great number of houses that have been started cannot be finished; and in some cases, the contract has been let but they cannot even be started because there is no cement available. You cannot get far in the building of a house if there is a shortage of cement. The government should do something to make Canadian cement available to our Canadian home builders. It is an odd thing that while you cannot buy Canadian cement in most of our large Canadian cities, you can buy American cement at about twice or three times the price of Canadian cement. You cannot build houses under the national housing plan or any other type of plan when you have to pay these exorbitant prices for materials.
I think the government should reconsider this proposal as to increased interest rates and delete it from the program. The government does not need that extra one-half per cent in order to finance its program. The mortgage companies do not need any increase in order to lend moneys out on this project, in view of the wonderful protection they have had up to this point. They do not need any increase in interest rates because their loans are guaranteed practically one hundred per cent. There is no other type of investment where you get such great protection. Surely that protection is worth a little bit of consideration.
. I want to join with the hon. member for Eglinton in suggesting that the government reinstate that one-sixth down payment. fMr. Johnston.]


Stanley Howard Knowles: You mean the additional one-sixth on the mortgage, not on the down payment.


Charles Edward Johnston: Yes, the additional one-sixth on the mortgage. It is exceedingly difficult, if not impossible, for people to start out without that assistance. I think that the minister is sympathetic and that he would like to see this done. But sympathy is not going to build houses. No matter how much sympathy may be expressed, it is not going to. get these people a home to live in. I would suggest to the minister that he take into consideration the suggestions which we have made.


David Arnold Croll: Mr. Chairman, I wish to join with the members who have already spoken in giving praise to the minister for the excellent job he has done in the department of which he has the honour to be the head. The minister's statement made today gave clear evidence that he has kept faith with the house and with the Canadian people. In addition to that, he is doing an imaginative and gratifying job in the field of housing, as his report today indicates. Despite the obstacles and the shortages, the high objectives set by the minister for the country have been realized. The year 1951, we are assured, will have as many house completions as did the year 1950. That is a real accomplishment. It is also heartening to know that defence production areas will receive special consideration.
I think the true significance of the minister's statement has not yet been touched on by the opposition. That was the invitation which he extended to the provinces, considering present conditions, to join with the dominion government under section 35 of the National Housing Act to undertake low-cost and low-rental public housing. Some agreements of significance have already been entered into for public housing in four provinces in Canada; but unfortunately that is all too few.	.
I think we must start by admitting from the very beginning that housing, like any other capital expenditure, is inflationary. We must also face the fact that housing is essential. It therefore becomes the government's job to reconcile those two aspects with respect to housing. After being in the doldrums for about twenty years, housing began to make real strides in this country after the war. The government, by a variety of legislative measures, stimulated house building in this country to the point where year after year the industry was setting new production records. Let me put some of these

on the record. In the year 1946 there were
67.000	completions, 57,000 net additions and
108.000	net family formations. In 1947 there were 79,000 completions, 71,000 net additions and 75,000 net family formations. In the year 1948 there were 81,000 completions, 73,000 net additions and 83,000 net family formations. In the year 1949 there were 91,000 completions, 82,000 net additions and 77,000 net family formations. In 1950 there were
90.000	completions, 81,000 net additions and
70.000	net family formations.
The minister has already told us that since 1946 the total of 414,000 new housing units have been built in this country. In the same period the new family formations have increased by 413,000. Therefore it is quite obvious that we have not been able to keep up with the current demand. In January, 1946, we started with a backlog of about 650,000' houses. As of January 1 of this year, we have a backlog of about 700,000 houses, so that we have a very long way to go yet despite the very encouraging and most excellent record as of this date. As a matter of fact, never before in the history of this country have we seen such a rush of new buildings.
I say that when in November, 1949, the government announced its program of public housing, as embodied in section 35 of the National Housing Act, it seemed to us that Canada was entering upon a new era of housing. It appeared that we were actually going places. Well, these high hopes have failed fully to materialize. They fell through in part for a number of reasons which are known to hon. members. First, there was [DOT] the national housing interest rate which was outstripped by the commercial interest rates, with the result that investment funds of the insurance and the mortgage companies dried up to the point where the National Housing Act was in danger of becoming a dead letter.
Second, the government's decision to curtail capital expenditure was like throwing a pail of cold water on the entire building industry. The announcement already referred to in this house on February 5 as follows:
Effective immediately, therefore, loans under the National Housing Act to homeowners will be limited to 80 per cent of lending values prevailing in January, 1950. The effect of this action is that the additional one-sixth provision is suspended.
-has had the effect of not only curtailing housing, but making it quite impossible for a great number of people to make the down payment. So much so that I think the government realizes that perhaps it has gone too far, andi will have once again actively to encourage more building, particularly in the defence areas.
r. 1951	3809
Supply-Resources and Development
Third, the provinces and the municipalities failed to take advantage of the government's offer to finance as much public housing as they wanted. There was no limit. The government was open-handed. It was prepared to deal with all takers. I find it hard to understand that only four provinces have made any attempt at all to provide public housing under section 35 of the housing act..
And finally, as other speakers have already said in the house, the astronomical costs of building have had their effect. There was a rise of 15 per cent in the cost of building in. the year 1950. The monopolistic attitude of the building supply industry lifted housing, right out of the price range of the average-citizen.
Whatever the reasons may be, housing cannot be permitted to decline in this country.. The splendid beginning which we made in the post-war period has proved that the thing is possible. We can and we must continue to go ahead with housing for Canadians. The first move was to raise the National Housing Act interest rates from 44 per cent to 5 per cent. No one regretted that or the necessity for it more than I did, because this country needs not just housing; it needs low-cost housing, it needs rental housing, and the National Housing Act, with its low interest rate andi long amortization period, was designed to accomplish just that.
I regret extremely that the government was compelled to do it, but compelled it was. It was faced with the clearest possible alternative: houses or no houses; and on that basis the interest rate had to be increased. Nobody liked it, but if it had not been done and done quickly, then only the people of Canada would have been the sufferers. I think I can say, without any fear of contradiction, that even at 5 per cent the National Housing Act is still the best housing deal in Canada.
The government's next step must be to reconcile the two conflicting views which I have already indicated, namely, the essentiality of new housing and the desire to' curtail capital expenditures. A new house-is the most obvious example of capital expenditure; but we cannot say because it is that it is taboo. We have to realize that there can be such a thing as essential capital expenditure, and that we should encourage. I think the solution is within our hands. The solution lies within section 35 of the National Housing Act.
We have done public housing in this' country. It is nothing new. We have built subsidized housing in this country. The [DOT] minister said that we have already built
3810	HOUSE OF
Supply-Resources and Development
53.000	of them. We have disposed of 20,000 out of the 30,000 that were available for disposal. We have 10,000 more to dispose of. He expects to dispose of 5,000 this year and
5.000	at a later period. The building of these
53.000	subsidized houses has not cost the people of this country one red cent. We have not had one penny of losses.
Section 35 of the housing act makes provision for the most economical kind of housing that this country can undertake. With the dominion government, the provinces and the municipalities co-operating to build public low-cost housing we can stretch the housing dollar a very very long way. National housing building is fine for the people who can afford the down payment; but there are far too many people m' this country who cannot afford the down payment necessary at the present time, but who still need houses. That is why section 35, the public housing section of the National Housing Act, is the instrument under which we can obtain low cost and rental housing.
What exactly does section 35 say? I am not going to read it. It provides that capital costs, profits and losses are contributed by the dominion government to the extent of 75 per cent and by the provincial governments to the extent of 25 per cent. In some cases the provincial governments have obtained a portion of the 25 per cent from the municipalities. But that gave to the provinces and to the municipalities a rare opportunity to build houses under this section of the act, because of the apparent advantages that are there.
Let me point out some of the advantages under the public housing section of the act. It permits the blending of houses of various sizes for families in various circumstances. There can be built multiple dwellings, apartments or single houses. One thing I would emphasize to the minister is that we ought not to spend a penny on emergency or temporary housing; we are far beyond that stage. That is a waste of money. We are here for good. Similarly, the houses we must build must be here from now on.
Then, so far as money is concerned, all hon. members have indicated the government can borrow money cheaper than an individual or any other organization can borrow it. Certainly we can get money cheaper than the loan companies are prepared to accept for the usual loan. In the past the government has been able to obtain money for less than three per cent.
Speakers from all sides of the house have talked about priorities. On such a government undertaking priorities and the alloca- * tion of materials could be arranged without
[Mr. Croll.l

any difficulty. As a matter of fact the hon. member for Moose Jaw quoted what had been said on June 4 by the Minister of Trade and Commerce, as it is reported at page 3671 of Hansard. The hon. member's question, referring to the Department of Defence Production, was in these words:
Does his department give specific priorities to housing projects for the purpose of getting building material?
To that question the Minister of Defence Production replied:
No, Mr. Speaker; there is no specific priority, but certainly there is a working arrangement with my colleague the Minister of Resources and Development for priority assistance in building houses, where that assistance is required.
If the minister is as powerful as the leader of the opposition says he is, he ought to have no difficulty at all in obtaining for us these priorities, when and if we require them. In addition to that hon. members have talked about the cost of building. The hon. member for Bow River who was a builder and knows something about this business has talked about the high cost of building. Well, there is no question that a great saving can be effected if the government gives out specific contracts for houses.
One other great advantage under this section is that we can locate houses where they are most needed; and in that way we should overcome the defence production need for housing at the present time. After all, public low rental housing in the last analysis is a choice between spending money constructively and wasting it on palliatives; it is a choice between using it to subsidize decent living and the opportunity for healthy citizenship and subsidizing demoralization, apathy' and delinquency.
I have said the housing problem is becoming acute in places which are referred to as defence production areas. I mean by that places where war contracts have reactivated industry, and where those industries have drawn many thousands of workers to focal points across the country. There are many of them in Canada-Toronto is perhaps the most obvious. The others include Malton, Sorel, Edmonton and Vancouver-there are many others. If as some eminent statesmen seem to think, the international crisis may go on for five or ten years, then the need for permanent defence housing becomes apparent and overwhelming.
The public housing section of the act is flexible enough now to meet this or any other need we may require within the foreseeable future. As a matter of fact the government is doing something under section 35 of the act; the minister gave us a brief resume of what is being done. Agreements have been

entered into with some provinces-I think they are four in number. I am informed that the following agreements have been entered into: St. John's, Newfoundland, on June 13, 1950, for 140 units, which have been completed; London, Ontario, on July 10, 1950, for 374 units; Windsor, Ontario, July 15, 1950, for 400 units.


William Moore Benidickson: The houses have not been built.


David Arnold Croll: I am informed that this applies only to the lots. Agreements have been signed in respect of Ottawa, Vancouver, St. Thomas, Kingston, Atikokan, St. John's, Newfoundland, and Saint John, New Brunswick.


Mr. Mclvor:: And Fort William.


David Arnold Croll: I do not find Fort William on the list.


Daniel (Dan) McIvor: It should be.


David Arnold Croll: The little that has been accomplished by virtue of the National Housing Act is good; but my point is, as has been indicated by the hon. member for Kenora-Rainy River, that no houses have been built, except in Newfoundland. The rest of these plans are on the drafting board. The people of this country need houses, not blueprints. Instead of these few units we are planning for this year the government should be sponsoring thousands of such units. This country could absorb 20,000 of them. As a matter of fact my own province of Ontario could absorb this year and every year 10,000 additional low-cost low-rental units. The rest of the country could use as many more.
The Ontario government can afford it. I have occasion to look up the financial status of that government; I do not bother going to Dun and Bradstreet, but I have seen their own statement. It appears that since 1948 they have had surpluses of $25 million each year. Housing is a good opportunity to invest a few dollars.
We have heard a great deal about one-sixth and the second mortgage. Ontario can stimulate building in the province by restoring that one-sixth or the second mortgage. That will provide for those who cannot afford a very large down payment at the present time. Here is a real opportunity for the government of Ontario to prove to the people of that province that they really mean what they have been saying about housing.
The hon. member for Eglinton quoted the premier of Ontario as saying: "Of all things to be cut back, housing should be the last". How heartily I agree with what he says. But I think he can do something about it. The opportunity is there for him to do it. I said
7, 1951	3811
Supply-Resources and Development before that the province of Ontario is in great need of housing, particularly defence housing, at the present time. By restoring the one-sixth they can once again activate housing and make houses possible for those working people who are finding the down payment so hard to make.
But it is not Ontario alone. I find it a matter of very great and deep regret that after the government put section 35 of the act into effect-we had been pleading for it for years in this house-no great advantage was taken of it by the provinces. They have not come through as expected. The dominion is putting up the lion's share of the money, but if there are no takers the people will suffer.
I think they should know that. So because of world conditions, because of the rise in the interest rate, because of the increase in the down payment and because of the high cost of materials, we find ourselves at the present time with a golden opportunity in the field of low cost and low rental housing, particularly when the government can borrow cheap money, allocations if necessary, and priorities for all that is essential.
There are a few obstacles. One of course I have already indicated, the apathy of provincial and local authorities, and their reluctance to get into this scheme. The other difficulty is the cost of building supplies. That is a very serious difficulty. I want to say something special with respect to that because I think it needs saying. The building industry in this country is being strangled by a system of hoarding materials and setting prices by the building supply houses.


Mr. Blackmore:: Hear, hear.


David Arnold Croll: Price maintenance and gentlemen's agreements are flourishing in the trade.


Mr. Noseworthy:: That is why we need price control.


David Arnold Croll: We may have another way to deal with it. Price control did not stop these monopolistic practices.


Mr. Rowe:: It started them.


David Arnold Croll: No one denies that scarcities exist in the supply of some commodities. But what we have is a concerted effort among the building supply houses to keep materials scarce and prices high. They are keeping certain essential materials for their old or special customers, and they are not opening up new accounts. Today there is no free and fair competitive market in the building material industry. I have a clipping from the

Supply-Resources and Development Toronto Daily Star of May 23, 1951, which reads as follows:
The composite index of the cost of residential building materials is calculated on a 1935-39 pre-war index of 100.
Summarizing the editorial: in 1945 the index had risen to 148-3. In 1948 it had risen to 217-5. In 1950 it rose to 256-3. In February of 1951 it had risen to 274-9, and in March of this year it rose to 282-6. The editorial goes on to say:
Where will it stop? Is there no governmental .measure that can decelerate or halt these increases?
IMr. Blackmore: Hear, hear.


David Arnold Croll: I think it is high time that the government investigated this situation and corrected it. There is no room in a field as vital as housing for practices of this kind. The Combines Investigation Act could be profitably employed with respect to this particular industry.


Joseph William Noseworthy: That would not do any good.


David Arnold Croll: The need for housing, and particularly low-cost housing and rental housing, is almost unlimited in this country today. The supply of materials is limited. Therefore I think the government must see to it that building materials are not diverted to high cost and unessential housing. They ought to go where they can do the most good. Press reports indicate that, in the first five months of 1951 contracts awarded for building were 89 per cent over last year. Housing did not hold up its end. Higher interest rates, higher down payments, higher cost of building have brought about a drop in housing starts which is already of some consequence, although not of major importance.
Building materials could not be better employed than in the type of public housing provided for under section 35 of the National Housing Act. Through public housing the same amount of materials can provide homes for more people than any kind of private building can. Public housing can build more homes. It can build them cheaper, it can build them better, and it can build homes at focal points across the country where they are most needed, in industrial centres where the growing population has far outdistanced present housing facilities, and particularly to meet the needs of defence production. I re-emphasize that I would not want any member of the house to have the impression from what I am saying that I am asking for something for nothing.
I have already told the house that we have long experience in public housing. We have

not lost a penny. We built houses, we rented them, we sold them at a later date. We have not profiteered or profited from them. That is not our purpose. We have provided houses for people at a price they were able to pay. I felt some concern about one of the statements made by the minister when he did a little worrying for the private builders. There is a field for private builders in this country, but it is not in low-cost or low-rental housing. The private builder starts where public and national housing leave off. Private builders are not interested in constructing low-cost housing or rental housing. Their interest is in profits. There is not enough profit in the field of low-cost or low-rental housing for them. I do not think we should waste too many tears on the private builders. They have done very well in the last five years particularly; as some members of the house have said, their whole approach in the past has been for the government to take all the risks and for them to take all the profits. I think the time has come for the government to make a fresh appeal to the provinces and municipalities to do more in the way of public housing than they have already undertaken or contemplate undertaking this year. The cost of public housing to the provincial and local authorities is so little in comparison with the benefits gained that they cannot afford to hold back. What we need, defence program and inflation notwithstanding, are conditions which will enable more rather than fewer people to buy low cost housing or rent it at reasonable prices. We have on the statute books of this country excellent legislation designed to meet that problem; we have the will to do the job, and we have done part of the job. We need the co-operation of the provinces and municipalities, not to create a builders' paradise, which would not be in the public interest, but to meet this housing problem.
I re-emphasize that the need is for low-cost, low-rental housing for our people. I ask the minister in considering this problem to balance the requirements of defence, which must have first priority, with the social needs of the people, which must come very close to that first priority. People are making sacrifices now, willingly and gladly. Give them housing, and they will not have the feeling that the cost of defence is being thrown upon the shoulders of the poorest elements in our economy. Nothing we can do at the present time would raise the morale of our people, and reinvigorate and strengthen them, as much as the provision of thousands of these low-cost houses across this country, where people can see them and

live in them. I ask the minister to do everything he can to reactivate section 35. Some provinces are anxious to take advantage of that section; Saskatchewan and Alberta both have made inquiries. Alberta will not have any difficulty with finances. Saskatchewan has the will which sometimes is just as good as finances. In each case these governments are looking for the opportunity to provide housing for their people. I ask the minister to co-operate as he has in the past. One hon. member said the minister knew how to get along with other governments. To that statement I can only add "How true." So far he has had excellent relations with the provincial governments, in a field which is difficult. I ask him to continue that policy so that by the time we meet again next year we will have built thousands of these homes for the people of this country.


Joseph William Noseworthy: I listened with a great
deal of interest to the remarks of the hon. member for Spadina. It was my good fortune to have the occasion to discuss such questions as this with the hon. member when he was mayor of a very important industrial city, and also when he was a minister in a provincial government. I fancy-though this may be mere fancy on my part-that I detect a slightly different approach to this question by the hon. member today than his approach under other circumstances. In all friendliness I would suggest to the hon. member for Spadina that he have his speech printed in two parts; that he send the first half to members of the cabinet, and the second half to his riding. The first half might help members of the cabinet to realize the potentialities of the hon. member as a prospective minister. I certainly think the second half would meet with the approval of many voters in his riding.
Probably no one in this house is more aware of housing needs in Canada today than the hon. member for Spadina, and I was rather disturbed to find, at least in the early part of his speech, that he was so complacent and so completely satisfied with government policy. I was rather disturbed to find him so anxious to eulogize that government policy and to pass the buck of responsibility for housing to the provincial legislatures. After all, we had this housing problem with us for four years after the war before the government introduced section 35 of the act. The minister told us the provinces were not able to get the necessary supporting legislation until along in 1950. Considering that seven of the ten provinces have already passed enabling legislation I would say that
7. 1951	3813
Supply-Resources and Development on the whole the provinces have done much better in that respect than the federal government.
The housing problem resolves itself into two phases. In the first place there is a dire need for houses. The best the hon. member for Spadina could say about the achievements of the government in the matter of housing was that during the past four years they have succeeded in building about 100,000 fewer houses than new Canadian families required. In other words in that four-year period they have dropped back about 100,000 houses, which have been added to that backlog which existed at the end of the war. I do not think the hon. member's figures do justice to the government in that respect. The figures contained in the 1950 report of the Central Mortgage and Housing Corporation are different from those quoted by the hon. member, and indicate that as of the end of 1950 we still needed close to half a million houses. I am prepared to be a little more lenient in this respect than the hon. member for Spadina. I think the very best that can be said of the achievements of the government since 1946 is that they have barely kept up with the need for new houses arising from year to year. We still have just as much of a housing shortage today as we had at the end of the war. That is the first fact.
I was delighted to hear the hon. member for Spadina, in the latter part of his speech which I suggested should go out to his riding, disapprove of the minister's marriage to private enterprise; that he felt there was a place for the government to take action in housing; that there was a place for publicly financed housing, particularly in the low rental group. The truth of the matter is that the provision of low or even moderate rental housing is not a commercial proposition at all with today's building costs. It is impossible for private builders to provide low rental housing, or even moderate rental housing. It is this field in which there is a great need for houses today, and if that need is to be met it must be met by public financing.
The prospect for catching up on that backlog of half a million houses is not very bright. In the 1950 report of Central Mortgage and Housing Corporation it is stated on page 6 that residential construction is that part of the construction industry least able to secure building materials in periods of shortage. In numerous places in the report there is the suggestion that the shortage of building materials in 1951 is likely to curtail the building of residential properties. According to that report, the picture is not nearly as bright as
3814	HOUSE OF
Supply-Resources and Development the one painted by the minister this afternoon. Even last year when, according to the minister, there was no shortage to affect housing, and when the department was advancing an additional loan of one-sixth of the basic mortgage, the net increase in houses was 83,000. According to the Central Mortgage and Housing Corporation report, the net increase in family and non-family households for the same year was 87,000. In other words last year, under those favourable conditions, we fell 4,000 short of keeping up with the new demands created during that year. We added an additional 4,000 to that backlog which had been piling up during the depression and during the war years.
Since that was the best we could do last year, what are the prospects for the coming year when we are faced with a defence program which will have first call upon our materials? It is quite evident that unless some priority is established whereby residential housing may secure building materials, we are going to add still further to that backlog. As a matter of fact, residential housing has never received its fair proportion of the men and materials available. According to the government publication, "Private and Public Investment in Canada in 1947," residential housing got only 34-3 per cent of the total construction expenditures; in 1948, 35 per cent; and in 1949, 34-8 per cent. Then, according to the corporation's report for 1950, the over-all share of men and materials that went into housing construction dropped back about four per cent as compared with 1949. This report indicates that housing construction is not likely to get its fair share of construction materials and labour in a situation such as that which faces us today.
I would suggest that one of the first steps in order to increase or maintain the building program, and to avoid adding still further to that half million shortage, should be a system of priorities for construction materials. I believe that is a must for the government. The second problem so far as housing is concerned is the cost of houses today. It places them beyond the reach of many thousands of our people, beyond their reach either to buy or to rent. I should like to refer to an article in the Economics and Political Science issue of 1949 which is entitled "The Economics of Low Rental Housing." This article is two years old, but the situation has not changed very much. The statement is made that the lowest income group, constituting 20-7 per cent of the population, could not afford to buy a house at all. The next group, 12-7 per cent, could not 

afford to own a house costing more than $3,000 or $4,000. That rules out one-third of our people who could not afford to own a house costing more than $3,000 or $4,000 two years ago, and who certainly could not secure any of the houses which are built at today's prices. There is practically one-third of our population for whom publicly financed houses must be provided if they are to secure houses. The next 20 per cent could not afford one costing more than $4,000 to $5,000. The next 12-1 per cent could not afford one costing more than $5,000 to $6,000. It is therefore quite evident that, at present prices, a large proportion of those who need housing accommodation-those in the lower income brackets -just cannot afford either to buy or to rent houses that are built even with government assistance at today's prices.
On page 11 of the report of the Central Mortgage and Housing Corporation I find that 4,311 housing units were provided through arrangement with builders and investors under what is called the rental insurance plan.


John Horne Blackmore: For what year was that
report?


Joseph William Noseworthy: For the year 1950. The average number of rooms in those 4,311 houses is four. The average, rental is given at $70 a month. That is $70 a month for a four-roomed house. That is the average for 4,311 of these houses built across the country by investors and builders, through arrangements with the government. That price puts those houses beyond the reach of hundreds of thousands of those in the low-wage category.
As was indicated by the hon. member for Spadina, the need for low-rental housing is one of the great needs today. I think, as does the hon. member for Spadina, that the advantage which some of the provinces have already taken of section 35 of the National Housing Act is probably one of the brightest features of that report. In two of those projects at least the rental is based on 20 per cent of the tenant's income, in the case of unheated accommodation, and on 25 per cent of the tenant's income in the homes that were heated. That provides the legislative machinery necessary for solving the housing problem of those in the lower income groups. Certainly the minister should be encouraged to press forward with getting an increase in the number of agreements with the provinces, and in giving the provinces every possible encouragement to provide these low-rental houses on this basis.

Another difficulty in connection with our present housing situation is the matter of financing. When the minister introduced the measure by which an additional one-sixth loan was provided for builders he told us, in his own words, as reported at page 1295 of Hansard of 1949:
We are establishing a pattern for long-term housing development . . .
Four months ago it became evident that the long term was instead a short term of about one year; for although that legislation remains on the statute books, the government has arbitrarily cancelled that feature of the legislation because it became the government's avowed policy to restrict building. I think it was made quite clear that the reason for cancelling this one-sixth loan was for the express purpose of curtailing residential building, in spite of the fact that we still need half a million new houses. It has been indicated by the minister himself and others, as well as in the report of the Central Mortgage and Housing Corporation, that the government was afraid that there would not be sufficient material available to build all the houses that would be started if that one-sixth mortgage loan still remained available.
Apparently the minister believes that if we are to solve the housing problem, we must be prepared to accept a lower standard of housing. I think he told us that if we could reduce by about 15 per cent the standard of housing that the Canadian housewife wants to live in, we would solve a fair part of our housing problem. I doubt if the Canadian people today believe that the only way Canada can work itself out of its present difficulty is by reducing living standards. The other evening the Minister of Finance gave us the same policy: the need for reducing living standards. I submit, Mr. Chairman, that we in Canada-even though, as the minister says, there is a housing shortage in all the countries of the world-have natural resources, in men and material, available for providing our people with houses, without lowering the standard of the houses with which our people should be provided. I suggest that the minister should restore that one-sixth loan in order to enable purchasers to make the necessary down payment on the houses that we are building.
There is another feature of housing financing that I should like to bring to the attention of the minister. Since he has raised the interest rate for finance companies the builders tell me-and as a matter of fact two of them told me this only today-that finance 80709-243
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Supply-Resources and Development companies are still refusing to advance moneys for building under the National Housing Act; that it is still practically impossible to get those loans; that the 5J per cent which the finance companies would get is still not sufficient to warrant their lending money under the National Housing Act. I should like a statement from the minister on that. I want to assure him that today there are builders whose applications were approved two or three months ago who were rejected because of the interest rate, and are still being rejected. I do not think the answer is a further increase in interest rates to mortgage companies, but I do think that the government has to take some measures. If they cannot get the mortgage companies to advance money at their rate, I think the government will have to lend that money in part directly under Central Mortgage.
It has come to my attention that a considerable amount of United States capital has been available for housing projects in Canada, or would be if those who would provide that capital could be assured that if the projects could be sold they could get the capital and take it back to the United States. At the present time the foreign exchange control regulations permit that, but the foreign exchange control board will give no assurance to United States investors that if they can sell their houses and the money is available they will be able to withdraw that money from Canada. I wonder whether the minister will also speak on that point.


Charles Henry: Mr. Chairman, this debate enables one to discuss the housing problem under the minister's estimates. My first words are of congratulation on what the minister has done, particularly for housing in the Toronto area during the period 1949 to 1951 inclusive.
The figures of Central Mortgage and Housing Corporation make it clear that for the three-year period, including the years 1949, 1950 and 1951, there will have been erected in the city of Toronto and its immediate surrounding area no fewer than 25,000 new housing units. If one were to take those 25,000 new housing units and place them on lots of standard width, say fifty feet each, he would have 200 miles of new housing units constructed in this three-year period. This means a string of housing units which would go from the outskirts of Toronto easterly to Kingston. I think this illustrates that tremendous things have been done by this government in stimulating housing during the three years in question.
However, although much has been done about the solution of the problem, may I say to the minister that the need is still great
3816	HOUSE OF
Supply-Resources and Development indeed in the metropolitan area of Toronto. We have five emergency housing centres located at Long Branch, Malton, Geco, Stanley Barracks and Lakeside Camp. There are no fewer than 1,010 families located in those emergency housing centres at the present time. These families comprise a group of 5,282 individuals, and only 545 of the 5,282 individuals are relief recipients. And too these individuals are in the centres for the most part through eviction proceedings, and through no choice of their own.
In a recent report of the welfare commissioner for the city of Toronto to the appropriate committee of city council it was said that with reference to those occupants of the emergency housing centres-and I quote the report:
In most instances no other accommodation was available following eviction.
Some had more than one eviction. I think it is also important to place on the record with reference to the Toronto area that at a recent hearing before the new rental board for the province Mr. J. J. Wingfelder, deputy administrator of rentals in Toronto, gave evidence-and indeed it is most cogent. He said:
The housing situation in the Toronto area is terrifying and has not yet reached its peak of seriousness.
With reference to rents Mr. Wingfelder went further. He said that Toronto is an area of highest pressure of rents for all of Canada.
My philosophy teaches me that the home is the backbone of the nation. In my view housing is the natural right of all Canadians. Private enterprise does not always keep pace with the situation, and government aid becomes a necessity.
I commend the minister and the government in that they have placed housing as second only to national defence in Canada. Toronto is an area where we expect to be, and we know that we will be, an arsenal of our preparedness program. It is gratifying today that before the orders of the day were called the minister stated that negotiations were now under way as between this government and the province for perhaps 5,000 housing units to be located in Ontario. We have heard and we believe that these negotiations have to do with 5,000 houses under section 35 of the act. Some will be for rent, and it is important that they should be low-rental houses. Some will be for sale. Others of those units will be apartment units. Let us hope that they can work out an arrangement whereby they will be low-rental apartments.
In the light of my remarks on the seriousness of the situation which exists I hope that the minister will bring to bear


upon the provincial authorities the importance of locating in Toronto our proportionate share of the new housing units rnn the basis of our needs and our population. It will be a sad thing to me if the minister, in his negotiations with the provincial authorities, cannot give us at least 2,000 units in this time of crisis when we have over 1,000 families in these centres, which centres have been called terrifying.


Louis-René Beaudoin: Shall the item carry?


Mr. Green:: No.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at eight o'clock.
Louis-René Beaudoin: We are considering item 427, emergency shelter administration, and item 565, dealing with Central Mortgage and Housing Corporation.


Howard Charles Green: Mr. Chairman, I should like
to ask a question having to do with a project in Vancouver known as the Fraserview project. About two or three years ago the government undertook, through Central Mortgage and Housing Corporation, to set up this project which was to contain 1,100 homes for veterans.
The whole area which, as the minister knows, is in the city of Vancouver, was expropriated by the government against the wishes of many of the people who had homes in that area. Then the area was resubdivided. Portions of people's orchards and gardens were taken away from them; in some cases their homes had to be moved; and as a result they suffered a great deal of discomfort. Central Mortgage and Housing Corporation have gone ahead and I believe have finished about 600 of the houses.
Earlier this year it was announced that further development of the plan was to be dropped at least for the time being, with the exception of completing the installation of services such as water, sewers and facilities of that kind. The result is that we have this large area sitting there, all topsyturvy, partially developed, the streets all changed, the parks-which were shown in the lovely plans put out by Central Mortgage and Housing Corporation-not put in. Indeed I think the project might properly be described as more or less of a mess. That is the description applied today by some of the people who have written to me asking that something be done to finish off the project.

There have been press reports to the effect that the lots upon which the homes have not been erected might be sold; of course this would mean that in some cases lots taken away from old residents will now be put on the market or turned over to real estate firms, or handed to the city for purposes of sale; the whole project will break down unless the housing corporation completes it.
We are told it has been held up because of the increasing costs, and I have no doubt that costs have gone up. But there seems to be very little prospect of their coming down in the immediate future, and I do suggest to the minister that where a project has been commenced and is well on the way to completion it is very poor business to let it drop when it has reached this stage. Not only is it very poor business, but it is most unfair to the people living in that district, including both the old residents and the veterans who have gone into the new homes which have been completed.
Moreover, it is unfair to the city. The city of Vancouver has co-operated throughout with Central Mortgage and Housing Corporation. I do not believe the minister can have any complaint about the way the city council have acted. But there they are, being criticized by the citizens; yet nothing can be done because the whole scheme is in the hands of the housing corporation. I do not think that is good enough, and I would hope the minister could arrange to have the project completed. In any event I would ask him to let us know what is to be done.


Mr. Maclnnis:: Mr. Chairman, I should
like to say a word, and after I have finished the minister can reply to both the member for Vancouver-Quadra and myself. Before referring to housing in general I should like to refer particularly to the Fraserview project to which the hon. member for Vancouver-Quadra has referred. He gave a broad outline of this project in which some 1,100 homes were to be built. Of these I believe about 600 have been completed and the building of the remaining 500 has been postponed indefinitely. That is the last information I have had in the matter.
As the hon. member for Vancouver-Quadra has pointed out, it is unfortunate that the finishing of this project has been discontinued. It is unfortunate first, because of the great controversy that was created about the project when the land was taken over by Central Mortgage and Housing Corporation. Second, it is unfortunate because of the great need for homes in Vancouver. There was a great deal of vacant tax land in the area, as well as many private homes. The city of Vancouver turned over the tax land 80709-243*
Supply-Resources and Development at a fairly reasonable figure to Central Mortgage and Housing Corporation, following which proceedings were taken to expropriate the private homes in the area.
There was great protest made when the homes of people who had been established for 25 to 30 years were taken away from them, and their lives upset. I supported the project and tried to make a case-I believe a case could be made-for what Central Mortgage and Housing Corporation was doing, in order to provide houses for the people of Vancouver, and of British Columbia generally, where there was such great need. But all the explanations and all the justifications we have made for the-project went by the board when the government, or Central Mortgage and Housing Corporation, decided to discontinue building when the project was only half finished. The government has decided to postpone the building of the additional 500 homes, because of increased building costs.
I have a copy of a letter written by the chairman of the Vancouver housing association to the minister. She represented that, even if the cost of each unit should be increased by $1,000 because of increased building costs, at 3J per cent interest and with thirty-five year amortization the increase in rent would only amount to about $5 per month. In view of the terrific need for housing in Vancouver, I suggest that involves a very small amount of money and should not divert the government from its intentions in that particular area.
Let me draw the attention of the minister for a few minutes to the housing situation in Vancouver at the present time. May I first tell him	that there	are still	2,000veterans	families	with four	or	more	smallchildren still waiting after six years for suitable housing accommodation. The building of the 500 houses would provide homes for at least	500, or	a quarter	of	those	2,000veterans	and their families.	At	the end of
1945 the emergency shelter administrator estimated that the shortage of houses in the city of Vancouver amounted to over 23,000 family units. Between 1946 and 1950, both years inclusive, approximately 14,700 housing units were started while the increase in the number of families-and the estimate is a conservative one-was 21,000.
I think the rate of building in Vancouver and British Columbia generally has been higher than in other parts of Canada, but despite the relatively high rate the shortage of houses has increased since the war by a further 6,300 units. Today instead of having a shortage of 23,000 units as we had in 1945 there is the shortage of 30,000, and the population of the city of Vancouver is increasing
3818	HOUSE OF
Supply-Resources and Development every day. In addition the government is making strenuous efforts, and I believe with some success, to bring immigrants to this country many of whom will ultimately reach Vancouver. I think we are seeking trouble if we bring people here without having homes prepared for them and when we have not homes even for the people who are here.
Before I leave the Fraserview project, I suggest to the minister that he give the matter his most earnest consideration before finally deciding not to go ahead with it. I iplead for that because of the controversy that came about as a result of expropriation and the hopes that were raised as to the *development contemplated in that area, one of the finest locations in the Dominion of Canada.
I should like to give the committee the figures as to building progress in Vancouver and greater Vancouver for 1948, 1949 and 1950. Greater Vancouver of course takes in the surrounding municipalities. Dwelling completions in the city of Vancouver in 1948 amounted to 3,391, and in greater Vancouver 6,315. In 1949 completions in the city of Vancouver amounted to 2,748 and in greater Vancouver 5,599. In 1950 completions in the city of Vancouver amounted to 2,271, and in greater Vancouver 4,679. Dwelling starts, buildings started but not necessarily completed, in the city of Vancouver and in greater Vancouver for the same years are as follows: Vancouver in 1948, 3,297, and greater Vancouver, 6,442; in 1949, Vancouver, 2,161, and greater Vancouver, 4,465; in 1950, Vancouver, 2,034 and greater Vancouver, 4,442.
These figures do not include Central Mortgage and Housing Corporation building for which the figures for 1948, 1949 and 1950 are 586, 324 and 294 units respectively, all in the city of Vancouver. I am putting those figures on the record to show that the need for housing both in the city of Vancouver and in the greater area is increasing each year because we are falling further behind each year in the number of homes required. While the need is increasing the number of homes completed and the number of homes started have declined every year from 1948 to 1950. Something must be done. I agree that we must give high priority to our national defence program, but here again I think we are making the greatest mistake we possibly can make if we are going to put everything into the defence program and leave the provision of homes to private enterprise.
It has been demonstrated that for the last twenty-five years private enterprise has not been able to build homes for that section of the community which cannot finance homes for themselves. What is happening today? While low rent homes are what is required,
IMr. Maclnnis.]

it is much easier to get money to build a $15,000 or a $20,000 home than it is to get money to build a $6,000 home. As a matter of fact if we are going to deal with the matter properly I think there should be a maximum limit on the cost of homes, because two homes at $6,000 each are better for the community than one home at $12,000. I suggest that here is a situation that must be dealt with with the greatest possible energy because it is of the greatest possible urgency.
There is one other point I want to bring to the minister's attention. There is another project of 200 homes to be built in the city of Vancouver on the three-way principle under the National Housing Act. The last I heard was that there was a possibility the Little Mountain project would not be proceeded with. I would be very glad if when he speaks the minister would give assurance that this will be gone ahead with at once, and that the Fraserview project will also be completed.


Robert Henry Winters: In reply to the hon. member for Vancouver-Quadra, there is very little I can add to the answer I gave to the question he asked in the house on April 9, at which time I told him some 600 odd houses had been completed with another 450 or so to go. We thought the prices for those houses were too high, that there was too big a cushion in them for the contractors, so in fairness to the ultimate tenants who would have to pay the higher costs in terms of rent we let the completion of the project stand in abeyance. We realize that it is very important to complete the project, and we intend to do so. As soon as Central Mortgage and Housing Corporation feels it can get realistic bids for the completion of the remaining houses to round out the project, it will do so.
As for the Little Mountain project, it is out to tender now and it is expected that tenders will be received within the next two or three days. Neither the government of British Columbia nor we have yet seen the tenders, so we are not in a position to say what the costs will be or whether the government of British Columbia will wish to go ahead with it. That is the status of that project.


Mr. Murphy:: I wish to take up only two or three minutes of the time of the committee. I listened to the statement of the minister this afternoon, and I was sorry that, like many other hon. members, I was not able to hear all the remarks of the hon. member for Eglinton, owing to the fact that I had to attend a committee.
In dealing with this subject I think we should localize some of our arguments, so for a few minutes I am going to speak of the situation as it exists in the Sarnia district,

one of the fastest growing areas in Canada, which I think every hon. member will agree is making a big contribution to our war effort. There, as we all know, we have the greatest oil refinery in the British empire, which is increasing its capacity by some 25 per cent. There we have the Polymer plant, which is also spending some seven and a half million dollars or so in an expansion program. There we have Canadian Oil coming in, with an eventual program which will cost some $20 million. There we have Dow Chemical, another industry which has contributed much to our war effort, with a $5 million project under way. Sun Oil has a thousand acres or more on which it plans to start a $40 million refinery when steel is available.
I appreciate the difficulties under present conditions, when we have the defence effort competing with the construction industry for available building materials, but I feel that the three levels of government must take steps to bring about a final solution to this problem, which certainly is acute in my area. Let me give one illustration. Just two weeks ago last Saturday night, at eleven o'clock, it became known that a home was available to rent. By twelve thirty some nineteen telephone calls had been received inquiring about that home. That shows how desperate the situation is in Sarnia. I heard what the minister had to say in regard to his chat with representatives of Ontario earlier this week, and I firmly believe there are certain districts in this country to which all levels of government must give special consideration, particularly districts which contribute so much to our defence effort. I believe all hon. members will agree that because of what we produce in Sarnia that is an area which is entitled to special consideration.
I have often thought we are a little slow, not only in this country but in other democratic countries, in carrying on research to find ways of building houses at a lower cost. It seems to me that today Central Mortgage and the loan companies have specifications higher than are necessary. Certainly in some areas they could be moderated, and I believe we will have to moderate those specifications to keep down the cost of building. Perhaps not many people realize what is required to even put up the walls of a house, or the strength of the lumber required to complete a home. I believe these requirements can be modified and costs brought down. It seems to me our research departments could do something, and maybe they are doing more than we think, to bring down these costs.
In our section of the country, and I think this applies elsewhere, we believe that since the new restrictions have been in effect the
1951	3819
Supply-Resources and Development construction of homes has been retarded. In the first place the builder has not been able to obtain a big enough loan to permit him to sell the home with a reasonable down payment. We have not many people in this country today, particularly in my part of it, who can afford to pay $3,000 down on a home they could have obtained a year ago for something like $1,500 down. They are not yet in that bracket, and I do not expect they will be able to afford such down payments. The need for homes is so serious that governments should not delay considering ways-and means of making houses available to-those in the low income brackets. That might be done by increasing the loans, or in someway under section 35 of the act, under which-the three levels of government make-contributions.
Then the higher interest rates, which apparently are inevitable, will be an important factor in the construction and purchase of these homes. There was a day most of us can remember when people built homes to rent, for revenue. That day is gone, I think forever, and today we must make houses available, either for sale or for rent, to those in the low income brackets. I know materials are scarce. As an illustration, my son had intended continuing in the building business after a sojourn elsewhere, but gave up his plan because he could not get rock lath or cement. One dealer had a backlog of fifteen carloads of rock lath, which seems to indicate something wrong with either our production or our distribution. The same thing applies to cement and other materials. I believe the statements made this afternoon as to the increased cost of building were much too conservative. I do not believe we in this country or any other country can depend on those who are engaged in selling building materials in any form to promote research which might lower building costs. That must be done by the government, because today those who have anything to sell can sell it at any price they ask.
Now, Mr. Chairman, I am grateful for these few moments, because I have to go to a committee. I am going to make another point which I think will illustrate what I have in mind. Only a few days ago I was talking to one young man who had sold approximately three-quarters of a million dollars' worth of homes in the lower price field, that is between $8,000 and $9,000, during 1950. I was amazed to hear the hon. member who preceded me speak of homes being built for around $6,000. I wish we could build: them for that amount in my area. You might build a three-roomed house for that, but
3820	HOUSE OF
Supply-Resources and Development you would not get much more. This illustration probably is typical of what is happening in many parts of this country. Last Sunday this young man told me that in the two weeks previous he had sold one very poor home, in the newer part of Sarnia which was taken into the city, at a price of $5,200. That was the only sale he had made in two weeks. There are not many people who can pay the higher down payment required to obtain shelter over their heads. In conclusion, Mr. Chairman, I believe that the government today must accept a greater responsibility than ever before for housing the people who require shelter.


Mr. Gillis:: I am only going to say a few words on this question, Mr. Chairman, as I too have a committee to attend. I listened to the minister's statement this afternoon with a great deal of interest, as I did the statement made by the last speaker. I thought that the minister's statement indicated the great extent to which the government has gone into the field of housing. I believe they have gone a long way since 1946. I might add that I do not have much of a housing problem in my constituency. We solved that problem some considerable time ago through co-operative housing and other methods.
The statement made by the hon. member who just spoke, when compared with what happened in 1946, indicates that the memory of some of the members in this house is rather short. In 1946 the housing field was wide open to the construction industry of this country, known as free enterprise. In that year the government had some control over the distribution of building materials, cement and so forth. A few of us in the house were urging the government to retain that control in the post-war period because we felt more supervision would be required in the sale and distribution of those materials during that period. Many of the hon. members to my right were demanding that the government get back to a normal way of doing things, the law of supply and demand. Slowly but surely the government obeyed that request and unravelled the mechanics of free enterprise. It was very much against our advice.
The statement the minister made this afternoon indicated to me that the government has gone some distance in maintaining the policy they suggested at that time, to the effect that in so far as possible or practicable they would take up the slack where free enterprise failed. The minister's statement definitely shows that they have done that to some extent. It is evident that the hon. 

member who just spoke has changed his opinion completely; he now demands that these materials should be controlled. But that is locking the door after the horse has been stolen. I cannot go along with him. For instance, in the field of housing the construction industry enjoys a rather secure position. They erect a building, and they are guaranteed against loss; money is made available to them. But they want to come in and exact the last pound of flesh.
We are told that an industry is being established in a certain section at a cost of $40 million, but the government is expected to provide housing for the employees. We are going to invent $40 million. We are objecting very strenuously to any excess profits tax. We are not going to contribute anything to the government in the field of taxation, except what we feel is right. But in and around that industry where hundreds of thousands of employees are going to be housed, we expect the taxpayers of Canada to provide the housing. This attitude puts the problem back further than it was fifty or sixty years ago. When the old industries like steel and coal were established in this country, they built houses and rented them to the employees at a nominal figure. After years on that basis, many of these industries passed the houses over to the employees at a very reasonable price. But modern industry is not taking any social responsibility. The social responsibility must be taken by the government, and by the taxpayers of Canada. Unlimited profits they must make, but they object to any suggestion of corporation taxes. Private enterprise must be allowed an open field in so far as profits are concerned, but the building of homes, social responsibility towards the public, that must be accepted by the government. We want government control to the extent of guaranteeing us profits and underwriting our losses, housing our employees, but that is as far as we want government responsibility to go. Do not touch us in the field of taxation. That is the position of the Liberals to some extent, and the Tories to one hundred per cent as indicated by their activities in demanding the removal of controls.
I merely wanted to make these few remarks, Mr. Chairman, because I listened to the minister's statement and I thought it was a very good statement. I believe the government had to go a long way in replacing free enterprise in the field of housing. It is a social responsibility which, in my opinion, develops with industry. I should like to leave this thought with the minister, that housing is one of the first requirements of citizenship.

I do not believe any person can be a good citizen until he drives his roots into the soil and owns a piece of land. I believe the best way to get that type of citizenship is under a co-operative scheme of housing. I do not believe the federal government is doing the right thing when they farm out to insurance companies and large contractors in this country the interest that they have in the building of homes. I believe that money should be made available to the municipalities across the country who plan the housing in the community, who set the taxation rate in that field and who must provide the services.
I think that whole thing should ,be decentralized. Instead of handling the matter through those large financial organizations who have no responsibility socially, who do not want any responsibility to the people as such, except the making of money, I think that process should be reversed and that the municipalities across the country who are with the people, plan for the people, service the people, should be given the money necessary to provide housing in their own communities.
It sounded rather peculiar to me a few minutes ago to hear British Columbia members standing up in this chamber and telling the committee about the terrific shortage of housing there was in the province of British Columbia. British Columbia is the lumber province in Canada. If there is any place in Canada where materials should be available at a reasonable cost, from the hardwood floor to the cement, it is British Columbia. There is something wrong with our planning, Mr. Chairman.
There is no shortage of cement in this country, and there never was. Any time you want to pay an extra 25 cents or 50' cents a bag, and take your cement from the black market, you can get it.


Mr. Ferguson:: Fifty cents a bag? A dollar a bag.


Clarence Gillis: May I say that you fellows in Ontario are a little bit easier to gyp than we are in the maritimes. It was American cement. There never was any trouble in getting it if you were willing to go on the black market and pay the price. In that field I say that there is a straight monopoly. That is the reason for the situation. There should be some government regulation in the field of supplying the basic materials. There is something wrong in British Columbia when there is a housing shortage. The answer is to provide for the necessary legislation when you are writing amendments to the National Housing Act.
At the present time there is in Nova Scotia a provincial housing act which contains a
7, 1951	3821
Supply-Resources and Development section that enables you to organize co-op. groups and finance the building of co-operative homes at a reasonable cost. I suggest that the National Housing Act should contain a simple provision on a national basis so that where men want to build their own homes it should be done on a national scale through the federal government; there should be a provision similar to the one now contained in the Nova Scotia housing act.
Low-rental housing will never be provided under the present act. The only way to provide it is to do so on a municipal level, through your municipal governments, under a subsidy arrangement with the federal government. If it were done in that way, it would not cost nearly as much money as it does today, with the exorbitant rates that are charged by the people to whom the government is farming out the taxpayers' money.


Julian Harcourt Ferguson: Mr. Chairman, in the last five years we have heard a tremendous amount of talk about shortages of this and shortages of that, when in reality the true picture is: just let us do a little less work, everybody. That is the true picture. The hon. member who spoke previously talked about British Columbia and why we should never have a shortage of housing. I am sorry that he is not now in the chamber, because I should like to assure him that, even in British Columbia, houses do not grow, irrespective of the amount of timber available there.
Briefly what is wrong in Canada today, in respect of all shortages, is that corporations are making tremendous profits. That' is not the only reason. I am not going to flail the corporations for making tremendous profits. I am only saying that they do so. Evidence of that appears in the papers daily. We read that such-and-such a corporation's profits have doubled, that such-and-such a concern has doubled its capacity. The previous speaker said that the government had gone to a source to distribute money for the building of houses, and he intimated that was not quite the right source, in spite of the fact that the corporation is all set up to loan out money, that that corporation has a tremendous stake in the Dominion of Canada, principally in the life insurance business, in which people have invested millions and millions of dollars, and hope to get them back. Handling money for loan purposes is one source of making legitimate money. There is nothing wrong with that avenue of dispensing money. They probably make a better job of it than the government could, because the government is not set up to lend money by millions for housing. They would have to

Supply-Resources and Development take on more civil servants, something which we are all growling about today. We criticize the government for the tremendous number they are employing. We are all saying they are employing too many, and I believe rightly so.
The truth is that no building materials grow on trees. The truth is that houses will not grow on trees. The truth is that people do not want to work more than eight hours a day, and some are clamouring for shorter hours. That is the truth, and that is why you are short of houses. We are short of cement and we are short of plywood. What is the actual reason for that? Not that the gift of God has not been bestowed on the Dominion of Canada with respect to raw materials. I believe in short hours if there is not enough work to go around. If you can produce what you need for this country in four hours a day, I say: let us work four hours and give everybody an opportunity to work. But I also remember that the Bible says: Six days shalt thou labour and thou shalt rest on the seventh day. I do not think that meant that you shall work four days a week.
As the previous speaker said, what we have got to do is get back to normalcy. Normalcy in the Dominion of Canada is not clamouring for shorter hours. Normalcy is not clamouring for greater pay, or for shorter hours and bigger take-home pay. Let us be men about this matter in the House of Commons and face the facts. You all know in your hearts what the trouble is. It is that we are afraid to work. We are becoming a nation of leaners. Let the people in my constituency-and this applies to every constituency in the Dominion of Canada, particularly in the small municipalities- try to get an American corporation to manufacture something in our town. Try to get an English manufacturing concern to come here, so that Canadians can have the great art of working, and can continue to be carriers of water and tillers of the soil, not participating in the cream of the profits. They will go to the stockholders of the English companies and the American companies, and we will continue to shout about that condition. We are becoming thankful for the fact that we are able to work, let alone make any surplus profit.
That is what is wrong with the Dominion of Canada. The people of Canada are afraid to work; that is, the great majority of them are. There is here in the Dominion of Canada ten hours a day of work cut out for every man who is willing to do it for the same pay he is getting, not overtime.


Let labour buckle down in all walks of life and, where it is necessary, increase then-hours of production.
I have built houses within the last ten years. On one occasion I sold a house. The purchaser was in the furniture business. He had contemplated a trip to British Columbia to see his customers six months previously. He had to move. He was paying $15,000 or $14,500 for this house. He wanted the moving people to move him, his wife and family, on the Saturday afternoon so that they could settle to some extent and order his furniture, and so that he could take the late train on Sunday night for British Columbia in order to carry on his business. Everything was completed except the polishing of the floors by the painters. I asked the painters if they would mind coming back on Saturday morning. Oh, no, they would not come back Saturday morning to help that man, with three children and his wife to get partially settled in their house. They had worked their forty hours a week. The same three gentlemen I have in mind were on relief for five consecutive years; and I am confident that I will live to see the day that the same gentlemen are on relief again, depending on the taxpayers and the good old government. As one woman said to me: I am entitled to a pension; I am entitled to money from the government. I said: "Who do you think the government is? Where do you think they get the money?" She said: "I don't know and I don't care". There is the trouble with the people of Canada. You can spend day in and day out in this House of Commons, one man presenting his views and another one presenting his views, one man saying that labour is not paid enough and another telling them that their hours are too long. Other people are blaming the suppliers of materials necessary for construction. There is not a man, irrespective of what he says in the House of Commons, or the party that he represents, that does not know the truth in his own heart. It is that people will not work long enough hours to produce from the gift of God the necessities of life. That is the trouble; not that you are short of materials, that is, raw materials. You are short of the stomach to work, and it is pretty near time that labour and management got down to the realities of life, put their heads together and said that irrespective of what happens behind the iron curtain or in any other part of the world, we are going to face realities, and if necessary we will work ten or twelve hours a day. When the time comes that we can sleep in bed all hours we shall work

eight hours -a day or four hours a day; but let us get down to it and stop the nonsense.


Mr. Beyerstein:: Mr. Chairman, the subject of national housing has been fairly well discussed this afternoon; therefore I do not think it will be necessary for me to repeat any of the arguments that have already been advanced, consequently my remarks will be very brief at this time. However, I should like to say that I have had some experience in building under the regulations of that National Housing Act. I have been associated with a firm which in the past two or three years has built about 28 houses under the regulations of the National Housing Act, and I can truthfully say that my experience and my association with officials of the Central Mortgage and Housing Corporation have in all ways been very satisfactory.
I should like to take this opportunity to compliment Mr. Douglas, who is in charge of the Central Mortgage and Housing Corporation office in the city of Edmonton and the surrounding district should like to compliment him on the efficient manner in which he handles the affairs for the corporation in that district. I have always found him very co-operative, always willing to give advice and help with any problem, no matter how large or how small. I think I can also say the same for the insurance companies. The insurance companies with whom I have been mostly associated are the Canada Life Assurance Company and the Manufacturers Life. I have found them very fair to deal with as far as advancing loans under this act is concerned. I have found their inspectors to be very fair, and they always make a thorough inspection, which I would say is to the advantage of everyone concerned, especially to the person who is buying the house after it is completed. Therefore I can truthfully say that my associations under this act have been very satisfactory.
However, I did have some correspondence from some of my constituents, in which they asked a few questions which I should now like to ask the minister. I shall make them very brief, and I hope that he will find time to answer them when he replies to other questions. As I say, these questions arise out of correspondence from my constituents. In the past it has been the practice, I believe, for Central Mortgage and Housing Corporation to supply contractors with scarce materials such as cement, wiring equipment, plumbing materials and so on, in areas where there is a shortage. Is that still the practice?
My second question is this. What are the regulations in an instance where an insurance company refuses to make a loan under the
Supply-Resources and Development National Housing Act? Suppose a party made application for a loan in an area where an insurance company was already in operation, and for some reason or other the insurance company did not feel that it should grant the loan, not necessarily because the party would not be entitled to the loan but for some other reason, perhaps. What would be the answer in an instance like that?
My third question has to do with the report regarding the curtailment of insurance loans. Is that just a temporary measure on the part of the insurance companies until they have the problem of interest rates adjusted?
These are the three questions which I should like to ask and I hope that the minister will be able to supply me with the information.


Robert Henry Winters: The assistance the hon. member referred to was in connection with veterans housing, under which Central Mortgage did provide material on a free issue basis. The corporation also did provide some assistance in supplying nails for a short time under ordinary operations, of the National Housing Act. At the present time there is no such arrangement.
With respect to the operation of insurance companies and their failure to operate in certain instances, the policy of the government and the Central Mortgage and Housing Corporation is that direct loans are not normally made in an area which is usually or normally served by an insurance company.
With respect to the third question, the curtailment of credit on the part of the insurance companies, we hope it will be temporary and that when the amendment to the National Housing Act has been passed by the house to allow for the higher interest rate they will again be in the mortgage field just as they were formerly.


Stanley Howard Knowles: Despite the applause which greeted the remarks that were made by the hon. member for Simcoe North I wish on behalf of the people of Winnipeg North Centre to deny his assertions, and I do so categorically. He made the statement that the real trouble in the country today is that our people are afraid to work, and do not want to work or have not the stomach to work. I have lived all my life either amongst the people of Winnipeg North Centre or amongst people like them. They are the industrial workers to be found in so many of our North American cities. The charge made by the hon. member for Simcoe North does not apply to these people.


An hon. Member:: It sure does.
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Supply-Resources and Development


Stanley Howard Knowles: Not at all, and the hon. member knows it. Not only are they willing to work and work hard, but they have vorked across the years of their lives, except-.ng those days when depressions have robbed them of the chance to work. All they are asking, all we are asking for them when we ask for government responsibility in the field of housing and in other matters of social legislation, is that people who work and produce the wealth of this country, whether it be in the cities or on the farm, have a chance to get back and enjoy some of that wealth.
When we ask for proper housing in cities and in the rural areas of this country we are not asking for something to be picked off trees and given to our people. We are simply asking that the people of this country enjoy what is their right out of the abundance that they produce. It is that philosophy that lies behind the arguments in the field of housing that we have made from this corner of the house across the years, and it is that philosophy which underlies the National Housing Act so far as it goes.
A good deal has been said today, particularly by the hon. member for Spadina, about section 35 of the housing act. The hon. member for Spadina referred to it as one of the most important sections of that act, and in that I agree with him. Section 35 is that section of the National Housing Act which provides for agreements between the federal government and provincial governments on a 75/25 basis for low rental housing projects. As I say, I agree with the hon. member for Spadina as to the importance of that part of our housing legislation, and I share his hope that the minister will be able to persuade the provinces to take greater advantage of it.
I was indeed sorry to note that in the minister's comments today on the workings of section 35 he mentioned a number of provinces, but was unable to make any reference to my own province of Manitoba. There may have been some correspondence, and he may have been in touch with the officials of that province, but it appears that no project under section 35 is under way. I know the city council of Winnipeg has made representations to the provincial government urging that it take advantage of section 35, but as yet nothing has been done.
I would point out that possibly one of the difficulties facing the provinces is that of finding the capital with which to finance their 25 per cent of any of these projects. The hon. member for Spadina this afternoon referred to Alberta as a province which was able to go into this, if it wished to, because it has money; and he indicated that Ontario,


too, has plenty of money. But that does not apply to all the provinces. It is perfectly true that it is no great burden on a province to suffer its 25 per cent share of any loss that may be sustained in the operation of a project under section 35; but, if I understand it correctly, as that section is set up, in order to get going at all the capital has to be put up in the first place. The federal government finds it much easier to obtain its 75 per cent of the capital than many of the provinces find it to obtain their 25 per cent.
I believe discussions have taken place between some of the provinces and the federal government as to the possibility of the federal government's lending that money to the provinces, it still being understood that the provinces would bear their 25 per cent share of any loss sustained. I hope when the minister speaks again he will tell us whether any consideration has been given to that way of making a more effective use of the provisions of section 35.
I was a little disappointed to hear one or two of the minister's comments this afternoon, when he was talking about these dominion-provincial agreements in the field of low-rental housing. If I understood him correctly he said something to this effect, that he was not sure whether low-rental housing projects, which were really low-rental in character, were possible under today's conditions, with particular reference to present high costs.
Well, low and high are relative words; but what struck me about that sentence from the minister was that it seemed to me that he was throwing cold water on these projects which are possible under section 35. I hope he listened carefully when the hon. member for Spadina was speaking, and that he realizes that his job in connection with section 35 is not to say anything that would discourage its use but, rather, to say everything and do everything that he can to encourage its use.
As has been said by other hon. members who have spoken, this is one of the most important parts of the government's housing legislation. It is just about the only part of it in which the element of subsidy enters. The minister will recall that when that section was first proposed the government really took a new forward step in this field, because it indicated its readiness to do something about low-rental housing even though to do so meant providing an element of subsidy.
Our philosophy about housing underlies all of that. We feel that just as it is part of the responsibility of the community as a whole to see that all children have the best

educational opportunities, so in this modern society of ours it is part of the responsibility of the community as a whole, through the governments they elect, to see that all the children, all the workers, all the people enjoy the benefits, not of slums, not of mediocre housing conditions, not of houses which are just roofs to exist under, but of proper housing in the best of communities, that can be planned by modern architects and engineers.
So I strongly urge that the government do everything it can to push the use of section 35 of the National Housing Act. I urge that consideration be given to the proposal that ways and means be found of lending money to the provinces to find that 25 per cent of the capital they must put up. I urge that consideration be given to changing that figure, if that is necessary. Perhaps 75/25 is not the proper relationship; maybe it should be 80/20, 85/15, or even 90/10. The government is into this business of being concerned about housing. It is a social responsibility and a national responsibility, and a good step has been taken. Let it not be nullified by apathy on the part of the government.
Another phase of the matter which was discussed today-and I shall take only a moment or two to speak about it-has to do with the question of the withdrawal of the provision for the additional one-sixth that was announced earlier this session. That has prevented many people from getting a sufficient loan to get started, and I do hope steps will be taken soon to restore to its maximum the amount of the mortgage that can be obtained under the National Housing Act. I know the idea was to restrict housing, because of certain shortages of building materials. Surely if housing is to be restricted it should be on some basis other than that of the size of the pocketbooks of those needing houses.
Then, with respect to another matter, namely the increase in the interest rate from 4J to 5 per cent, I am afraid I cannot agree with the hon. member for Spadina, with the minister and with others who have expressed a similar view, that this might help the situation. It seems to me that what is needed in this field of building new homes is something of the same philosophy that the government has accepted with regard to homes for rent.
Here, too, the element of subsidy must enter, and I am satisfied that the day will come, because of our sense of social responsibility in respect of housing, that we will introduce an element of subsidy into the assistance we provide by way of help in building new homes. One of the ways that can be done is by making money available,
Supply-Resources and Development not at the rate of interest which can be obtained by investors of private funds who invest their funds for making profit, but at rates of interest which approximate the actual cost of lending money.
I must not get into a speech on financial or monetary policy, but it does seem to me that what we should be doing is not raising interest rates that the National Housing Act permits to insurance and loan companies, but rather we should be lowering that interest rate, even if it means that the government itself, directly or through the Bank of Canada, must actually lend money directly for the building of houses. If the government lends money for that purpose at a rate less than the market rate for invested money it is true that will be to a certain extent subsidizing the building of new homes, but I submit that is every bit as good as subsidizing the production of gold and a lot of other things we subsidize in this country. In fact the providing of homes is one of our greatest national social responsibilities, and I urge consideration of that phase of the matter.
Several members who have risen to their feet tonight have indicated that they had to leave to go to committees, and there are indeed quite a few committees meeting. One who had to go to a committee before he could get a chance to speak was my colleague, the hon. member for Kootenay West. Just before he went he said there was one point that he would like to see given expression to in the course of the debate tonight. As a matter of fact it is a view I would be very happy to express myself, and I do so not only on my own behalf but on his behalf. He pointed out, as other members in the house have pointed out from time to time, the difficulty that people in small unincorporated communities, villages, and so on, have in getting the benefit of our federal legislation. This legislation is not only for the cities. It is not only for larger centres. It should be for all Canadians. If the insurance and loan companies do not feel that way about it, if they do not want to make their money available to help people to have decent homes in the rural areas and in small unincorporated communities, I submit there again the argument is strong that the government should step in directly. I make that plea on behalf of the hon. member for Kootenay West because he had to go to a committee, and I support it most strongly myself.
There is just one other comment I wish to make, and it relates again to something that the minister talked about in his remarks this afternoon. He referred to the fact that Central Mortgage and Housing Corporation at one time had some 53,000 rental units. He

Supply-Resources and Development indicated that some 30,000 of those had been offered for sale and that 27,000 had been purchased. I believe he gave some other figures, but that is enough for now. I take it that the reference in that statement is in the main to wartime houses that have been sold to veterans. I would have to admit from the large number who have purchased these homes that there must be many who feel satisfied with that program of the government.
I must tell the minister, however, that I am still receiving complaints about this program from various parts of the country. Earlier this session I drew to his attention complaints from the Winnipeg branch No. 1 of the Canadian Legion. I have since had occasion by correspondence to draw to his attention complaints from places like Brantford and Paris in Ontario, again from veterans organizations. Only two or three days ago I wrote him on behalf of another branch of the Canadian Legion in northern Ontario. I could mention other places, such as Regina, Fort William and other cities.
In all these cases the complaint is the same. Veterans who have been renting these houses for a period of time and have enjoyed the benefit of lower rent than they might have had elsewhere are being pressed by Central Mortgage and Housing Corporation to purchase these homes. In some cases when they are not able to purchase the homes they are occupying they find that other veterans come along and purchase them, and the veterans who are in them have to move elsewhere. It makes one wonder just how many of those who have purchased these homes did so under pressure. The veterans in these organizations in the centres I have named, and in other centres, feel that they are being treated unfairly in this respect. They hear a great deal being said about the desirability of low rental housing projects, about projects of this kind that enable people to live in quarters that they can pay for within their means. But here you have a program like that being upset by the policy of the government at the present time.
I agree with the hon. member for Spadina that these matters with respect to wartime housing and with relation to emergency housing only touch the fringe of the problem, and that our real effort should be concentrated not on them but on ways and means designed to build permanent housing for the people of this country, and let it be housing of a kind that our people really deserve.


Mrs. Fairclough:: Mr. Chairman, I am sure from the remarks I have made previously


on this subject it is well known how concerned I am about the housing situation in the city of Hamilton. In a local newspaper the other evening there was a dispatch from Ottawa claiming that the Minister of Defence Production has authority under recent legislation to assist companies to build houses in communities where defence contracts have produced an acute housing shortage. I have noticed at various times that in articles appearing in the press with reference to the housing situation in Canada, and in particular with reference to the communities where defence activities are producing a bad housing situation, the name of the city of Hamilton rarely appears. Two or three of the larger cities appear but in the city of Hamilton we have a situation that has developed over many years and, while I dare say it is similar to that which obtains in other centres, it is nevertheless aggravated by many factors.
I should like to quote from a very interesting report on housing presented at the annual meeting of the Canadian welfare council by a member of the Hamilton body. She says in part:
. . . poor housing has been a chronic state in many parts of Canada for many years. With the first world war families began to crowd into the city areas and the need to house this influx was not adequately met before the onrush of the depression meant the doubling up of families who could not afford to keep up separate establishments. Besides, there was no money available for building, either for rent or sale. Then came the next war with its shortages of building materials on one hand and the rapidly growing number of new families on the other. Post-war has brought steadily rising costs and now again we are being faced with an increasing shortage of materials with a result that the gap between needs and available supply is widening rather than decreasing.
After some general comments she goes on to speak about Hamilton in particular and gives some very pertinent figures. She says:
In Hamilton we have about 1,600 wartime houses with on an average of one coming free every month. On the waiting list they accept only veterans with children and on the list at the present time there are 603 families wanting to rent and over 1,000 wanting to buy. Here are a minimum of 1,600 families (for it does not include nonveterans) seeking what they consider adequate accommodation at a reasonable rent. Some are separated with all the loss of daily living together that means an impoverishment to both the parents and children, not to mention the possibility of the weakening of the tie between them and the beginning of a loss of responsibility. Some are living with relatives which can usually only provide a satisfactory solution for a short period of time. Such a situation is full of potential danger to the development of healthy families.
In reference to this lady's statement that a thousand people want to buy houses at the present time, I should like to go back to the day in this house earlier in this session

when the minister announced the curtailment of the loans of one-sixth. I recall that I was amazed and greatly concerned over what I was sure would happen; and today in our city an investigation is going on which has broken into the headlines of our newspapers, with rather pitiful photographs. The one I now hold in my hand is of two small children, I would judge about three years of age, tied to a telegraph pole. They live in a highly congested area where the street, and a very busy street at that, is the only playground. So they will not be run over by the traffic, their mother ties them to the telegraph pole every day when they go out to play.
A few moments ago the minister spoke about the action to be taken shortly in connection with raising the interest rates. This article also mentions that, and says that in the meantime advances on mortgages have been frozen, with the result that builders are starved for ready cash and will be starved until the move is approved, which the writer guesses will come up in the house about July 1. I should hope that whatever is holding up the cash advances on these mortgages might be dealt with expeditiously so the work can proceed. It is estimated by the builders in Hamilton that only about 300 units will be built there in 1951, with over 1,600 families needing homes immediately. Only 51 dwellings were started in January of this year. I do not have the figures for the subsequent months, but with the mortgage money being frozen for the time being I do not suppose they are very cheerful.
I have more articles and more pictures which I would be glad to send to the minister, though I dare say he gets them from every city in Canada. In his statement this afternoon the minister said:
We will pay particular attention to the communities where housing is most needed. Because defence production is the main effort of the country today the government is anxious to do everything it can to meet the housing needs in defence production areas.
Whatever consideration is being given to making it easier for builders to build and for workmen to own their own homes, I do hope special attention will be paid to Hamilton. There we have this situation, that not only are all these people seeking homes but in some districts existing homes are actually being removed to make way for expanding industry. In one section 250 people are being put out of their homes for this reason. We have the loss of this housing accommodation, and we have all these people coming to Hamilton now to work in our defence plants.
Supply-Resources and Development These industries are by no means at their peak; this is only the beginning. We have this backlog of housing, as I quoted from the report, which goes back even to the first war days, and the situation is being further aggravated by the destruction of existing homes. I cannot too strongly urge the minister to give special attention to this city, because I know that from Hamilton must come a large part of the defence production which may ultimately save this nation.


Robert Henry Winters: Perhaps I should say a word in reply to the hon. member for Hamilton West and tell her that though the situation is very difficult, and no one overlooks the seriousness of the housing situation in her city, I hardly think she was justified in remarking that she doubted whether 300 houses would be built in Hamilton this year. The statistics show that 433 houses were started in the first five months of this year as against 307 last year, and that in the metropolitan Hamilton area there have been 800 completions so far this year as against 485 last year. Houses under construction at the present time number 881 as against 806 at the same period last year.


Ellen Louks Fairclough: I did not know how
many had been started this year. I am pleased to hear that the number is over 400, but even that is merely scratching the surface. We do have in Hamilton, or will have as soon as this trunk sewer on the mountain is finished, a large area which can be serviced very quickly. That is a situation which has not obtained for some time.


Robert Henry Winters: I did not mean to imply that the problem had been solved; I just wanted to say it was considerably better than the 300 the hon. member mentioned.


Mr. Adamson:: I want to bring to the attention of the minister a problem which is causing a great deal of dismay in many municipalities. I refer to the rapid increase in municipal taxation. There is no question but that we need every house we can possibly build. There is no question but that we should have a greater house-building program. But there is another problem which is ancillary to the general problem of the construction of houses, particularly low rental houses and more particularly houses assisted under any government scheme; that is the servicing of those houses after they are constructed, through municipal taxation.
This is a terribly serious matter. Municipal taxation is different from any other type of taxation because it destroys the asset you have. If in one year the tax on your house is X units and it goes up to X plus 20, X plus

Supply-Resources and Development 50 and so on until it gets to 2X units, the value of your house is considerably less than half its value before the increase in taxation. Under our federal and provincial system of government municipal taxation is caused by the essential services which must be provided by the municipality, such as schools, streets, lighting, sidewalks, sewers and all the other things that must go to service a house. They are as essential as the bricks and mortar, the floors and the roof that go to make up the house, and in my contention they should be considered part of the cost of building that house. Many communities have been ruined because a housing scheme has increased taxes through the necessity of building more schools, roads and the hundred and one other things that must be provided. The old residents in that community will then have had their investment impaired, and the value of their houses considerably lessened by the new housing project.
A year or so ago, Mr. Chairman, I suggested that in order to relieve the burden of municipal taxation, municipal taxes might be considered as a deduction of income for income tax purposes. I still think that was a good suggestion, and would have helped considerably. However, the problem we face today is that municipalities, both large and small, particularly in the province of Ontario, are confronted with a serious physical problem owing to the number of new dwelling houses that have been built. I wonder if the minister has considered any of the following things? First of all, when a new housing project is being built with federal assistance, is the community in which it is going stabilized, that is, is the ratio of industry to domestic houses such that tax increases will be equitably borne by both industry and domestic dwellings; does the community in which these houses are being placed have any type of town planning to ensure that the location of the new housing units will be maintained as a proper housing area and not become blighted through industrial development?
These things are very important, Mr. Chairman, not only to the individuals who live in these communities, but to the government to safeguard its investment. I should like to see some provisions in the housing act to the effect that only in properly planned communities would assistance be given. I am sure that in the long run this would be of benefit to all, because if you have an unplanned municipality and you have an addition of hundreds of houses, you are going to upset the equilibrium of that municipality. Then, instead of producing an asset, you may produce a great liability, a liability not only
tMr. Adamson.]

to the people already living in the municipality but to the very people you want to help. If a house is built in an unplanned district, the district might deteriorate and the investment of the home owner would deteriorate along with the district.
I hope, Mr. Chairman, that the minister will be able to do something in this regard, because I sincerely believe that a properly planned community is the best safeguard, not only for the government but for the home owner whom we wish to help.


Mr. Browne (St. John's West):: Mr. Chairman, I am sure that everyone was impressed by the minister's statement this afternoon. It sounded to me as though the minister had been responsible for many improvements, and for increasing the number of houses through the facilities provided by the act. It came to me somewhat as a shock to hear the hon. member for Spadina state that the housing shortage is greater now than it was in 1944. There is now a shortage of about 700,000 houses. If that is so, then there is some truth in the statement of the hon. member for Eglinton that housing is the No. 2 problem of the nation. It ranks next to the question of defence.
If that is so, Mr Chairman, then I feel that perhaps this committee has not been giving the attention to this subject which it deserves. I cannot speak for any other community than the one I represent. I know the minister is familiar with that community. He has been there, and he has seen the problem for himself. I believe he will recognize that there is a problem in St. John's which is only being scratched at the present time. He spoke of 140 units, but I did not hear him say that they had been completed. I heard the member for Spadina say they had been completed. They were in the process of erection when I saw them in January, and I am glad to hear they have now been finished.
I do not know what arrangement was made for putting people into them. I understand that instead of being a low-cost rental proposition the houses will be rented for $40 per month. I do not believe that many of the poor people in the slum areas would be able to occupy those houses and pay that amount of money. I do not want to prolong this debate unnecessarily, but I would point out that one section of St. John's was destroyed by fire in 1892. The part west of the line where the fire took place is very old and has to be renewed. I believe the municipality is now tearing down some of those houses. We have three main problems down three, and one is slum clearance. The province has adopted something of that nature, but we have to have new houses in which people can live.
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It seems to me that once before, Mr. Chairman, you prevented me from speaking about the terrible conditions in the slum area of St. John's. I must repeat that those are serious, and no honest man can feel happy about those conditions under which the people are living. I suppose there are places in this capital city of Ottawa where people are living in such conditions that we would be ashamed to let outside people know about them.


Louis-René Beaudoin: May I ask the hon. member to remind me of the circumstances in which I prevented him from discussing this matter?


William Joseph Browne: We were discussing this subject before, Mr. Chairman, and I was speaking about the hardships of the people who live under poor housing conditions in St. John's. I believe the chairman thought I was harrowing the feelings of the members of the house, and perhaps might harrow the feelings of the people who live in those houses. 1 believe you should recall the incident, Mr. Chairman.


Louis-René Beaudoin: If you will pardon me, I do not. I should like to inform the hon. member that at the time I interrupted him when he was speaking about slum conditions in St. John's I did so because I considered he was not in order. In any event, I shall look up the matter. I do not believe the hon. member should say that at one time or another I prevented him from discussing a certain subject if he was in order.


William Joseph Browne: The main point is that we have these conditions from one reason or another, and they ought to be removed. The question arises, whose responsibility is it? Is it the responsibility of the municipality, the province or the federal government? It seems to me it is a joint responsibility of the three forms of government. The minister has authority under the act to conduct research and investigation, I am wondering if he has been carrying on any investigations in the city of St. John's? It seems to me that city is so situate that we could have an ideal city there. An enormous amount of work has to be done before the city can be called an ideal city. I am wondering if the minister has been giving sufficient attention to the conditions as they exist there. The city is greatly congested. As he knows, the houses are mostly of wooden construction, built side by side, largely in long rows of ten, fifteen, twenty and perhaps even more than that, with narrow streets. A beginning is now being made to eliminate the worst places. I trust that some kind of plan will be devised so that, when houses
7. 1951
Supply-Resources and Development are being constructed in the area which is being cleared, they will be of a different type and provision will be made for playgrounds and parks. That is one of the problems that I think should be a matter of study by the officials of the minister's department.
There is another problem that exists in Newfoundland about which I think the minister may perhaps not be aware. I do not believe there are many places outside of the cities or large towns, where a loan is being granted by the Central Mortgage and Housing Corporation. On behalf of one fisherman living in my constituency I made application for a loan to the Central Mortgage and Housing Corporation agent down there, and it was turned down. It might have been turned down for some other reason than that it was in a rural area. But I do not believe that any effort is being made by Central Mortgage and Housing Corporation to make these loans available to that class of person where he wants to build a house or where he wants to improve it or enlarge it. Only the other day a lady wrote to me to see if she could obtain a loan for the completion of the house which the husband had built. I consulted with the officials of the Central Mortgage and Housing Corporation and I was told that no loan was available for that type of thing. Yet I find in the act, under the section dealing with home improvement loans or home extension loans, that such a loan can be made. I do not know whether any regulation has been made to prevent it. But that is the information I obtained from the agent in St. John's and from the office here in Ottawa. It seems to me that more consideration should be given to the people who live outside the cities. The trust companies will not lend them any money; and if the federal government will not lend them any money, they are under a great handicap, and what they are really doing is contributing for the benefit of other people, because in paying taxes they are helping to make loans to people who live in cities. Surely the minister will 'give that matter consideration. But it seems to me that overriding all that-and it is the principal thing I have to say-if the problem is so serious and we are slipping behind, and have slipped behind another 50,000 homes in the past five or six years, the minister would be justified in setting up a commission to deal with this problem for some years ahead. We have had a royal commission on the arts and sciences. We have had a committee of this house doing wonderful work in connection with old age pensions -which are going to cost the government hundreds of millions of dollars a year. We have had a royal commission on transportation. But was any one of those



Supply-Resources and Development commissions or committees concerned with anything more important than the housing problem in this country? I am sure the minister will agree with me that the housing problem should be tackled now. It should not be allowed to slip back, because it will slip back faster during these war years, or these years of tension, if we neglect it. I urge upon the minister that he not allow his colleagues in the government to give the matter of housing a place too far back when considering matters of policy.


Mr. Harkness:: In his initial statement this afternoon the minister spoke with a considerable amount of satisfaction about the sales which had been made of wartime housing units. I can assure him that that is not a satisfaction which is shared by a considerable number of the veterans in Calgary at least, or by some, I think, in other places. Earlier this evening some reference was made to this matter, but I should like to deal with it from a slightly different point of view.
What is actually happening or what has happened in several cases in Calgary is that people who bought these wartime houses have now moved out of them and are renting them to other people at $70 and $80 and $90 a month. In the meantime, they have moved into other houses themselves which they have bought in some cases. That is the situation in at least two cases that I know of. Naturally that procedure makes for bad feeling amongst the many hundreds of veterans who are without houses, who were on the waiting list for some years, in some cases, waiting to get into one of these wartime houses.
The first question I should like to ask the minister is whether there is any means whatever that his department can put into effect to prevent this sort of thing from going on; I refer to the situation of a person getting into one of these houses, buying it and turning around and renting it to somebody else at a high rent; because in Calgary housing is extremely short, the people are desperate, and these high and excessive rents can be secured. It may be a thing which would be rather difficult to stop, but I would think that when one of these wartime houses is sold to the tenant who is in it, a provision could easily be put in the contract to the effect that there would be no what you might call renting it out at a high level. Surely it would be possible to put into effect some safeguard to prevent this abuse from going on. It is an abuse which I think causes an unnecessary amount of bad feeling.
In addition to that, I should like to ask the minister whether the tenants in these houses are being put out or whether there is any intention of putting them out if they have

no other place to go. In his statement this afternoon the minister said that, as to tenants who did not wish to buy-and the ones who do not wish to buy are mostly those who just cannot raise the down payment with which to buy, they are in such bad circumstances- when the house they are in is sold they are put into another house owned by Wartime Housing. I should like to find out if that is always the situation. Amongst these people in Calgary who are in the position of not being able to buy their houses, there is certainly quite a strong rumour going around to the effect that if they do not buy them by October they are likely to be out of luck. The word that goes around there is: Make sure that you get your house bought before October or you are likely to find yourself out on the street, come next spring in any event. I should therefore be obliged to the minister if he will make a statement with regard to those three questions that I have asked. I should also like to say at this time that I think that this policy being followed by the government of getting rid of these wartime houses as rapidly as possible was probably a mistake, in view of the present housing situation. I should like to ask whether they intend to sell all those houses or whether there is any intention of holding a certain number of them to look after what we might perhaps call some of our neediest cases among the veterans.


Gordon Francis Higgins: I have three questions I should like to ask, and the minister can answer them briefly. He told us he had built 140 new houses in Newfoundland this year, I believe. I wonder where they were built, or where the building sites were. Can he tell me anything about the demand, how great the demand is? Has the cost of building changed any? I refer to the actual cost.


Louis-René Beaudoin: Before the minister replies, may I be permitted to deal with the remark that was made a moment ago by the hon. member for St. John's West when he spoke of slum clearance and when he said that I as chairman prevented him from discussing that subject, on a previous occasion. The committee will recall that I rose at that time and said that if I had stopped him it was probably because I considered that while he was discussing slum clearance, he was out of order. I now have Hansard showing what happened at that time. It is found at page 2444 of volume III of the second session of 1949. The committee will bear with me. It is very important that this point should be cleared up. It reads as follows:


William Joseph Browne: I should like to
clear up a few points with regard to what my colleague has said about this section. It is rather

difficult to approach the matter in view of the answer just given by the minister. I would certainly ask his sympathetic consideration if the subject ever comes to his attention. I understand the minister has been in St. John's, and has seen the conditions prevailing in certain sections of the city. There is a historical explanation of those conditions.
St. John's was destroyed by fire in 1846, and wooden houses were built. In 1892 half the city was destroyed by fire, and the half that remained'-which covers about 50 acres-is in a bad condition owing to overcrowding. During the first and second world wars, people went to live in areas known as Southside hill and Blackhead road. The area is really in a scandalous condition. No interest is being taken in these people. In two sections of the city at least there is certainly a need for a housing project. If I could describe truthfully the condition-


Louis-René Beaudoin: I must ask the hon.
member to confine his remarks to the clause under discussion. His remarks must be strictly relevant to the clause.


William Joseph Browne: Surely, Mr. Chairman, when we are speaking on a housing project we must say why it is that we need one. I hope the minister is not objecting to my drawing these things to his attention. He may have forgotten them in his hurried1 visit, but I am closely associated with them. I have been closely associated with these conditions for a great many years.


Louis-René Beaudoin: That cannot be done
under this section. We are now discussing section 9.


William Joseph Browne: The minister
said it could. He told us that a slum clearance project could be considered under this section because it is a project arranged between-


Robert Henry Winters: No, Mr. Chairman. I think I should clarify that point. I said that slum clearance and this section could be regarded as complementary projects. But this section has nothing whatsoever to do with slum clearance as such. Slum clearance is covered under an entirely separate section of the National Housing Act.


William Joseph Browne: Since the minister gave me that answer some time ago, I have read the section and I think the position is this.
Then he carried on, but he did discuss the matter of slum clearance again, and there was a point of order raised by the minister. Therefore, I say it is clear from the record that when I asked the hon. member for St. John's West not to discuss slum clearance it was because I considered that in doing that he was out of order.
When the hon. member for St. John's West reads the remarks that I have made following his this evening I hope that he will follow the only course which is proper in the circumstances.


Robert Henry Winters: The hon. member for York West raised one or two questions, and perhaps I should deal with them. His great concern was about town planning. I might say that is a great concern of the Central Mortgage and Housing Corporation as well. There is a town planning section in the act, and they have a town planning division in the corporation. Where projects are concerned, which I imagine is what the hon. member had primarily in mind, it can be
Supply-Resources and Development taken for granted that unless there is adequate planning the project does not proceed. However, I should say that the main approach to the problem now is under section 35 of the housing act where the proposals and the planning come from the province, and it goes forward only on a joint agreement basis. However, we are very strong supporters of town planning, and we think that where possible it should be adhered to.
On the point raised by the hon. member for Calgary East, there are circumstances in which houses sold to veterans are in turn resold, and I would imagine that the rents charged are perhaps higher than would have been charged had the house remained in the hands of Central Mortgage and Housing Corporation.
For war workers' houses where they are sold to a civilian there is an arrangement under the agreement whereby if the purchaser retains occupancy for a period of five years he gets a preferred purchase right, which is an inducement and prevents that sort of traffic, you might say, that the hon. member had in mind.


Douglas Scott Harkness: That does not prevent renting the house.


Robert Henry Winters: The fact of the matter is that he must have occupancy himself for a period to earn the preferred purchase price. There is no such arrangement, however, for veterans houses, and they can indulge in rerenting, as the hon. member has pointed out.
The sales program to which he referred has been going well. I think the hon. member asked whether or not there were cases where veterans were put out of a house and no suitable replacement provided for them. Central Mortgage and Housing Corporation knows of no single instance, and I know of no single instance, where a veteran was not re-accommodated within the project area, and there have been no major difficulties in that regard.
The houses made available for sale are those up to and including the 1947 program where the arrangements with the municipalities have permitted it, and where suitable arrangements have been made with municipalities.
The hon. member for St. John's East referred to housing conditions in St. John's and, as I understood him-and I did not understand him too clearly-asked whether the demand for houses in St. John's is still strong and what is the relationship between costs now and costs a year ago.


Gordon Francis Higgins: Not only in St. John's, but throughout the province generally.

Supply-Resources and Development


Robert Henry Winters: The demand for housing is of course still strong, and roughly speaking the costs now are about 15 per cent higher than they were a year-ago.


Douglas Scott Harkness: I should like to thank the minister for the answer he gave me to my questions, and to ask him also if there is any truth whatever in the story which is circulating very strongly that October is the deadline for people in those houses to buy them.


Robert Henry Winters: There is no truth in that statement.


Gordon Francis Higgins: There is one other question the minister did not answer. I asked where these houses were built and where the building lots were said to be. Are they all in St. John's or in other parts of the province?


Robert Henry Winters: The project which the hon. member referred to is the Ebsary estate in St. John's.


Douglas Scott Harkness: There is one other question I asked which the minister did not answer. Is Central Mortgage and Housing Corporation proceeding to sell all of these rental houses, or are they going to retain a certain number to look after what you might call the most needy cases of veterans needing rental houses?


Robert Henry Winters: I answered that, I think, only indirectly. I did say that up to and including the 1947 building program all the houses are being made available for sale, where that is permitted under the agreement with municipalities, and where suitable arrangements have been worked out with municipalities. Houses built for veterans since that time have not yet been made available for sale.


Douglas Scott Harkness: How many houses would that leave since 1947 in Calgary which would still be available for rental purposes?


Stanley Howard Knowles: Give it for Regina and Winnipeg as well.


Robert Henry Winters: Perhaps we can look that up and give it to the hon. members before we pass from housing altogether.


Joseph William Noseworthy: Can the minister tell us
whether there has been any change in the attitude of lending companies since the announcement of the increased rate in interest? Are they still reluctant to lend?


Robert Henry Winters: They of course are not in a position to lend now. The amendment has not been dealt with by parliament. We understand, however, from talks with them that, once the legislation is enacted, they will be in the mortgage field and will carry out their lending program.


Charles Edward Johnston: Could they not do it under
the old plan? There is nothing to stop them from lending under the old plan?


Robert Henry Winters: The reason we had to seek
an amendment to the act was that they were no longer lending under the old rate of interest of 4J- per cent. But we believe and we hope that they will return to a lending program at the new rate of interest, once this amendment has been passed.


Joseph William Noseworthy: Can the minister say
why lending companies with offices in Ottawa refuse to lend money to builders across the river?


Robert Henry Winters: I do not know the particular circumstances, but I would imagine the lending institutions are exercising their privilege of making loans to the best advantage, where they can.


Stanley Howard Knowles: Are there any agreements
pending between the government of Manitoba and the federal government under section 35 of the housing act?


Robert Henry Winters: No, there are not.


Stanley Howard Knowles: Have there been any discussions as to possible agreements?


Robert Henry Winters: To my knowledge, sir, there have been no discussions since the discussions we had with them at the time we were considering changes to the act, which ultimately resulted in the passing of section 35.


Stanley Howard Knowles: I take it from those answers that the government of Manitoba has not made an approach to the federal government. Is the federal government doing anything further to try to sell this idea to the provinces, such as Manitoba?


Robert Henry Winters: Well, in view of the responsibilities various levels of government have for this problem of housing, we do not feel it would be appropriate for the federal government to put on a strenuous sales campaign to induce a province to enter into any program that is primarily its responsibility. But we have, in various public statements, on very many occasions, said that section 35 was available to anyone who wished to submit proposals that would meet with the mutual satisfaction of all levels of government concerned.


Joseph William Noseworthy: While the Minister of
Finance is in his seat, perhaps he could assist the Minister of Resources and Development in answering a question I raised this afternoon. I pointed out that, to my knowledge, there is American capital available for building in Canada, provided some assurance could be given that if investments

could be liquidated within a given period of two or three years the original capital could be taken back to the United States.
I have before me the regulation of the foreign exchange control board which states:
A non-resident who makes a new capital investment in Canada (other than in marketable securities) and records the investment with the board when it is made, is permitted under the policy followed by the board at present, subsequently to liquidate the investment in Canada and withdraw the proceeds from Canada.
But the foreign exchange control board can give no assurance that that policy may not be changed without notice at any time. Can either of the ministers tell us why that could not be done?


Mr. Abbott:: Perhaps I should answer the question. It has been the policy of the board for a good many years. On important matters of this kind one can never and probably one should not ever give a positive assurance as to what might have to be done under other circumstances. My recollection is that even in the latter days of the war we allowed new investments of that kind-that is, post-September 1949 investments-to be taken out by the investors. But circumstances might be such that it would be necessary to impose very much more drastic exchange regulations. I do not contemplate for a moment that it would be, because the whole trend in recent years has been to relax. But the outside investor, of course, has to take his chances on it.


Douglas Scott Harkness: I should like to ask the minister, following his reply concerning this business of people buying these wartime houses and then renting them at high prices and using the proceeds to build other houses for themselves, if any consideration has been given by his department to safeguards which would prevent that very abuse from taking place.


Robert Henry Winters: I have the figures for the houses that will remain in Calgary, and also in Regina and greater Winnipeg, if all the houses up to and including the 1947 program are sold. In other words these houses on the 1948-49 programs number:	Calgary, 300;
Regina, 147; and greater Winnipeg, 1,415.
Then, on the other point to which the hon. member for Calgary East referred, I would say that this is a matter that has been receiving consideration. It is known that what the hon. member has described as an abuse does take place. It is difficult to cope with when Central Mortgage and Housing sells a house to a veteran and gives him title. Normally one would consider the veteran is free to do with his property what anyone else would
7, 1951	3833
Supply-Resources and Development do with property acquired under a similar transaction. However, I can say that the matter is one of concern and consideration; but beyond that I have nothing to say.


Douglas Scott Harkness: You have no answer to it yet, do you mean?


Joseph William Noseworthy: Has the minister any information regarding the number of times that veterans who cannot buy their houses are asked to move, in this process of selling veterans' houses? My attention has been called to one or two cases where not only the first but the second house was sold, and the veteran had the idea that he had to keep on moving so long as the house he occupied was saleable. Is there any information on that point?


Robert Henry Winters: The instances concerning
which we have immediate knowledge are very few. There are not more than two or three such instances. We would have to search the records for an accurate number. Anyway it is a very small number, indeed.


Stanley Howard Knowles: Only two or three instances where the same veteran has had to move twice? Is that what the minister means? Surely there are more cases than that where the veteran has had to move because the house has been sold.


Robert Henry Winters: Two or three instances where he has been obliged to move once, and then the house to which he moved has been sold. I understood that was the nature of the hon. member's question.


Charles Edward Johnston: One case in particular in connection with the sale of veterans wartime housing in Calgary has come to my attention. I took this up with the government and I must say a very satisfactory settlement was made.
In general the complaint was that some of these veterans have been living in wartime housing the government decided should be sold. It now appears that some agents are coming to veterans who moved into these houses and are telling them that unless they are prepared to buy them right away they will be kicked out on the street. Those are the words that were used.
I understand that is not the policy of the department. It is my understanding that if these people cannot buy the houses in which they are living, they are not to be kicked out. In the case I brought to the minister's attention it worked out so that these people, after having been informed they were going to be kicked out if they did not buy the place, are now assured that they are going to be able to live in that house. I think there should be some regulation governing the

Supply-Resources and Development attitude of the inspectors who go around to the veterans giving them such information. It not only instils a great deal of fear in the people who are living in these houses hut it gives the department a bad name because in these cases the department itself must take that responsibility. Is there anything being done by the department to notify these people now living in wartime houses, and who cannot possibly raise the down payment-I think it is 10 per cent-that they are not going to be kicked out, that they do not need to worry, and that as time goes on they will be given every opportunity to purchase the house if they can raise the down payment? It would certainly do a lot to relieve the anxiety of some of these people living in these houses.


Robert Henry Winters: I think that question was
dealt with in reply to a question asked by the hon. member for Calgary East. I know of no instance in which a veteran was told that if he did not buy the house he would be kicked out.


Charles Edward Johnston: I drew a case to the attention of the department.


Robert Henry Winters: We have been informed at
various times that people dealing with the sales program have been harsh in their language, and on investigation we have always found that they have never been quite as harsh as had been represented to us. Nevertheless in all instances Central Mortgage and Housing Corporation has been very anxious that there shall be none of that aggressive approach to the problem. They have cautioned their people. They have emphasized the element of good will, and I believe in the over-all picture they have been successful in achieving pretty good public relations.


Charles Edward Johnston: I want to assure the minister that I was not misrepresenting the case. I took it up with his parliamentary assistant and it was very satisfactorily settled.


William Joseph Browne: Can the
minister tell me whether they have made any study in the city of St. John's with regard to housing needs?


Robert Henry Winters: The problem in St. John's
is well known to Central Mortgage and Housing Corporation. They have been over it a great many times with the Hon. Mr. Vardy, minister without portfolio in the Newfoundland government, who is responsible for housing. The local Central Mortgage and Housing Corporation officials are fully familiar with it, and I think that in brief the question can be answered in the affirmative.


Joseph William Noseworthy: I did not get the minister's answer to my question. How many veterans have had to move once because the houses they occupied were being sold, and how many veterans have had to move more than once because the second houses were sold?


Robert Henry Winters: The answer is something
that I can get only after having the records searched. We would not have the information available at the present moment. Would the hon. member be satisfied if I give him that information on a subsequent occasion?


Joseph William Noseworthy: Thank you.


John Horne Blackmore: I have not been able to
be present during the discussion, and I trust I shall not be repeating. However, so far as I can see, we seem to have got ourselves into a dead end street here and there in discussing the matter of housing and finding a solution. One of the difficulties appears to be that some provinces are hesitant about entering into agreements. Could the minister give the committee some sort of idea as to what seems to be the main reason or reasons why the provinces hesitate to enter into these agreements? It is granted that they realize that housing is their responsibility and that they are anxious to improve housing. The provinces must be just as anxious to improve housing conditions as anybody could be, and the same must be true of the municipal authorities. What seems to be the difficulty in the way?


Robert Henry Winters: I think perhaps the various provinces approach the problem in various ways. I of course would not presume to speak for them or to represent to this house what they regard their difficulties to be. I would imagine the hon. member has in mind particularly the province of Alberta. They are one of the provinces that did not pass complementary legislation to enable them to enter into arrangements under section 35 of the National Housing Act. We have had some discussions with them about participation under the act. They have their own views on how housing should be developed and what steps should be taken with respect to it. I certainly believe they have honest views. There is no question on that point, but the fact of the matter is that until recently they have not taken steps to qualify themselves for participation under section 35. Recently they did indicate an interest, and we told them that we would be very happy to receive specific proposals from them. However, I would imagine that before they can participate they would have to do something about their legislation.
tMr. Johnston.]


John Horne Blackmore: There is no general statement that could apply to the majority of the provinces?


Robert Henry Winters: No.


John Horne Blackmore: They do not tell the
minister they are afraid to take hold of the thing for fear they will be unable to finance it?


Robert Henry Winters: No, there has been no such general statement.


John Horne Blackmore: It seems to me in listening to the discussion and attending to it as far as I have' been able to be in attendance-and I should like to congratulate the minister on the hopeful attitude he manifested in his original statement-that we are confronted with certain frustrations in our efforts to provide the housing that everybody desires to provide in this country. The first one is the indisposition of a number of provinces to enter into mutual arrangements satisfactory to the dominion government. Unless we can find out what it is that is deterring the provinces, it appears that this will continue to be a cause of frustration. Even after we find out what is the matter, we shall have to find some way to meet the difficulties with which the provinces are confronted.
The next question that seems to have developed before us is that the mortgage companies are hesitant about lending very freely in connection with the building of houses. I can understand why that should be. If taxation continues to grow, as was indicated very well by the hon. member for York West, certainly no prudent organization would risk very much capital in communities where taxation is going to increase as rapidly as it has been increasing. I know that in the community in which I dwell, which is an ordinary small town with about 2,500 of population, the taxation rate has become so great that people simply cannot support the taxation. Nevertheless there does not seem to be anything that the community can avoid. They say: We have got to have schools and we have to have certain other facilities. The demands for these are increasing and we just simply cannot avoid the expense involved. We simply have got to raise the taxation. Those who are charged with responsibility, school boards and other municipal officials, say: Heaven only knows where this thing is going to end. It seems to be getting worse. Therefore we are confronted' with a problem which I presume is general throughout the dominion.
It is not likely that the mortgage companies will be more willing to lend money in future
7, 1951
Supply-Resources and Development than they are now; in fact from the standpoint of ordinary reasoning it would appear that they will become less willing to risk their money. Can the minister see anything we might do to overcome the necessity of having the mortgage companies lend this money? For example, from the standpoint of plain, ordinary common sense I cannot see why in the world we could not use the Bank of Canada to lend money so people would have what they needed, at rates no higher than per cent. Can the minister see any reason why that should not be done? It just seems grotesque, does it not, that a nation like this should be prevented from developing adequate housing for its people simply because the mortgage companies dare not lend the money necessary? It is almost impossible to be reconciled to a situation so unreasonable. The hon. member for Winnipeg North Centre says-the mortgage companies do not want to lend money. I do not blame them. I wager that if the hon. member had at his disposal all the facilities of an ordinary mortgage company, with all the responsibilities that rest upon it, he would not lend money either. What is the use of putting money into houses on which enormous taxation will be imposed, with the danger of losing those houses to the municipalities? Just common sense prudence, which I am sure the hon. member for Winnipeg North Centre is endowed with, would tell him not to do that.


Stanley Howard Knowles: If I were head of a mortgage company I would not be the member for Winnipeg North Centre.


John Horne Blackmore: That is not answering the question. I have the highest admiration for the hon. member, but we must be realistic in these matters. He speaks as though it were in some manner reprehensible on the part of the mortgage companies that they hesitate to lend money. I do not look upon it in that way at all. The mortgage companies have money in trust, and it is their business to lend money to make money in order to discharge their responsibilities. Certainly no one with any responsibility at all will lend money when there is every chance of not being able to make money, and where in many cases it is likely they will not be able to get the money back, and may lose the whole thing.
This problem must be overcome. I am sure the minister can see there is a problem which amounts almost to complete frustration. 1 should like to know whether he has given any thought to what he can do about it. If he finds that he simply cannot overcome this difficulty let him come in and announce that fact frankly to the house, so hon. members

Supply-Resources and Development may participate freely in a discussion as to the best way out of the difficulty. Surely there is a way out. We have the ability to build houses in Canada. We can produce the necessary goods and materials, and we have the skilled men. I would like the minister to give this question some attention and give the house his reaction. We have two problems. One is the indisposition of the provincial and municipal authorities to participate, and the other is the indisposition of the lending companies to loan the necessary money. That indisposition is completely understandable, and in my opinion no way reprehensible.


Stanley Howard Knowles: Every dollar they loan is guaranteed by the government. They do not lose a cent.


John Horne Blackmore: Then how do you account for their indisposition to lend?


Stanley Howard Knowles: Because they want to make more money.


John Horne Blackmore: I am quite willing to
undertake an argument with my hon. friends; I have never sidestepped a fight with the socialists in this house, but if the people whose business is lending money to make money are hesitating in doing so, there must be some good reason. Either they cannot make the money, or they have not a reasonably good chance of making it. I do not want to become involved in a lengthy discussion of that aspect of the problem. The simple fact is that if the mortgage companies are unwilling to lend money there is no conceivable reason why we should not use the Bank of Canada to make these loans. That is all there should be to it. If the minister is unwilling to risk using the Bank of Canada there must be something wrong with the minister or with the men who are with him in the cabinet. It is simply idle for us to come here year after year, as we have done since we started grappling with this problem after the war, and wring our silly hands and say this is a problem that cannot be solved. We are 261 men and a fine, effective woman; yet we sit here year after year doing nothing effectively to meet the problem.
I do not say we are not building houses; but it has been recognized quite definitely that we are not building them anywhere quickly enough. The minister and everyone else must recognize that. Well, if we are not building houses quickly enough what is to be done about it? It is not that we do not have the material or the desire on the part of the people. Certainly we have the skill to enable us to build houses, and those are the three determining factors which should govern. We have all the things that are necessary except

the disposition to use the facilities that are at our disposal. If that is not the case let someone prove it. I think I can safely challenge anyone to prove that is not so, as I believe I can challenge anybody to show that we cannot use the Bank of Canada to build houses in Canada.
The next difficulty appears to be that we are running into shortages of material. I will grant that as the danger of war develops we may require more and more construction for military purposes, and we are likely to run out of certain materials. But has the minister canvassed the possibility of using certain kinds of soil in the construction of houses? I understand that this has been done successfully in Germany and other parts of the world. This may sound a bit crude, but when my folks came to Canada, and before that, we were building sod shacks, which were called "soddies". For the first six or seven years of my life I lived in a cabin with a sod roof and with the spaces between the logs of the walls daubed with mud. Let no one imagine I am advocating that we should have people living in log houses with the spaces daubed and the roofs covered with sod, but we would be far better off if thousands of people in this country could have houses even as good as that, and be sure they would not be kicked into the street. But we are not disposed to help them build such shelter; we are disposed to let our people go on suffering. Hundreds of thousands of people in this country today have no assurance that they will have a roof over their heads next year. Sometimes it is because they have children, and people who are renting houses do not want children in them. In most cases the people needing houses simply cannot pay the heavy cost of available housing, houses valued at $8,000 or $9,000. Are these people to be left without housing? Is there any reason why we cannot provide them with some kind of houses?
Now, then, has the minister done anything about probing into the possibilities of using other materials? I think I shall stop now before I have too many questions for the minister to deal with. I shall just summarize those three. The first one is, is there anything we can possibly do to enable the provinces to enter into these agreements? Might I say this, that I think the average provincial government realizes that if the cost of municipal government in the province goes on increasing at the rate it is now doing -and there seems no way of overcoming that increase-then the province simply will never be able to finance the building of the houses necessary within the province. I shall

wager that that is ninety-five per cent of the reason for the provinces hesitating about getting into the housing problem. Now that is the first question.
If that is the case, then obviously it is a financial matter again, is it not? No province has the ability to increase its financial revenues by a dollar, except by the development of industry within that province. It is absolutely limited in the matter of revenue, to its ability to raise money from its people by taxation. It must have assistance from some source, which can resort to other measures, if it is going to be able to enter into the housing business.
The second question concerned the matter of lending money. I should like to have the minister tell us what has been done in respect of securing an alternative to the mortgage company. If nothing has been done, why has it not been done? We are going on year after year doing nothing about it.
The third question is, What has the minister been doing in regard to materials so as to enable us to use soils, if need be, so the people can have houses they can depend upon? Will the minister deal with those three problems?


Robert Henry Winters: Mr. Chairman, with respect
to the first question about what we can do to induce the provinces to participate under section 35, I think all I can say is substantially what I said before. We have told them collectively and separately that we would be glad to entertain specific proposals from them. Our legislation is clear. I believe it is understood by the provinces. Again, all I can say is that it is there if they wish to use it.
With respect to the second matter, the availability of mortgage money, in a detailed sense that of course is beyond my scope. It is something I would normally expect the Minister of Finance to deal with. The fact of the matter is that at the present moment the availability of materials for housing, and the availability of mortgage money to build houses, are pretty well in balance. The shortage of mortgage money was going to have an adverse effect on housing, in fact the mortgage companies had just about withdrawn from operations. We felt obliged, in the interests of the Canadian public, to take these steps which we think will keep the housing act alive, even though it means a slightly higher interest rate to the borrower.
When I mention the matter of materials, it brings me to the hon. member's third question as to what we are doing about finding materials that might be suitable for
7. 1951	3837
Supply-Resources and Development housing. The Central Mortgage and Housing Corporation has a research section which works very closely with the national research council on matters of materials. They are finding substitutes all the time, and approving them for one purpose or another. They are not a matter of great public knowledge, but the fact is that some progress is being made all the time in the matter of new materials	and improved materials for
housing.


John Horne Blackmore: Mr. Chairman, I appreciate the minister's answers. But the minister's answers, all members of the house will agree, amount simply to this. We face complete frustration on each and every one of those three points. There is not anything we can do about removing any one of these three difficulties in our endeavour to provide housing for this nation.
Mr. Chairman, I am prepared to grant that the minister is not to blame for any one of these three problems. But if the members of this house are going to face this thing like grown people, with realism, they have got to do something to help the minister. This is especially true of the members of the Liberal party. If they are going to discharge their responsibility to this nation, they have to do something about it.
Obviously, the facilities are at their disposal if they choose to use them. With respect to materials, the minister said we are conducting research and are making some progress here and there. My question is, why are we not getting the houses? I am sure the member for Spadina was not extreme when he pointed out we are not getting nearly enough houses. But what are we going to do about it? I believe that the discussion we have had this afternoon and tonight has indicated that just about one-third-I would not be surprised if we could say more than that, just about one-half-of the people in Canada simply cannot afford the housing which is being offered under the housing act. Look how serious that is. That means virtually all the people who really need houses cannot get them. Are we not going to do anything about this matter?


Mr. Fournier (Hull):: Talk about it.


John Horne Blackmore: That is right, the Liberals are.


Alphonse Fournier: You have been repeating the same thing for the last half hour.


John Horne Blackmore: That is just about what the minister has been doing. He certainly has been repeating frustration.


Alphonse Fournier: You have not spoken about debt-free money yet.

Supply-Resources and Development


John Horne Blackmore: That is right, and speaking of debt-free money in the presence of some members reminds me of one of the passages in the scripture, "cast not your pearls ..." I ask the Minister of Public Works to get up and tell us what to do about it. It is all very well for him-


Alphonse Fournier: You never sit down long enough for me to make a statement.


John Horne Blackmore: I have been sitting down. I have not spoken today until now. I have listened nearly all afternoon. At a time when people are simply groaning under the burden of inadequate housing in this country, here we are going to finish this discussion once more apparently with nothing done. That is all there is to it. The interest rate is raised, and the government's aggregate assistance to the people who would build has been cut down.


Mr. Lesage:: Write to your friends in the government of Alberta to do their share, and everything will be all right.


John Horne Blackmore: The government of Alberta can show the whole Dominion of Canada a mighty fine record-


Jean Lesage: They are not coming under section 35.


John Horne Blackmore: If the hon. member wants to have a discussion on the matter of Alberta I shall give him the opportunity and make him look like two cents. This sort of silly, flippant, idiotic remark about the government of Alberta is just an example of general Liberal irresponsibility. It is irresponsible to make a general statement like that. It is made so the press will pick it up and make it look as if something was said. After all, the something that was said demonstrated that there was "nobody home" in the head of the speaker.
Now, Mr. Chairman, there is one more thing and that is this-I am not repeating nearly as much as the Minister of Public Works would have it appear. The ordinary individual who wants to build himself a home-a modest little home, one that he can afford-today has no facilities whereby he can do so. Throughout this country there are great numbers of people who build their own homes just as men used to build their own sod shacks and their own log houses. They would build their own homes and they would learn how to do the building readily if they could only get a loan and get the material with which to build the homes. To tell us in Canada that materials of the kind are not available is to be absolutely unrealistic; and every member of this committee knows that right well. There

certainly are in this country materials which can be used for building; and the people, generally speaking, would use those materials and build the houses, if they could get the money with which to buy the materials. But we will not let them have the money because we say we have got to get it all from the mortgage companies and that we cannot lend it to them except under certain circumstances. We therefore have to go on facing complete frustration.
I do not propose to say any more about this matter just at the present time, Mr. Chairman. If the people throughout the country could realize and know how many times during the last hour and a half we have had from the Liberals all over the place calls of "carried, carried", and could realize how completely that indicates the utter indisposition on the part of those members to find a solution for the problem, I do not know what they would do. I suppose they would go and. elect a Liberal government right away again, because they would not have any alternative.


Some hon. Members:: Hear, hear.


John Horne Blackmore: They would have no
alternative-I suppose I shall be out of order-because the Conservative party which faces them has exactly the same policy as the Liberals have, and the same ideas. There is not the slightest difference in the world.


Douglas Scott Harkness: Say not so.


John Horne Blackmore: One does not have to say it. We are listening to it all the time. To say that there is no alternative as far as the Conservatives are concerned is quite obvious, and does not need to be said.


Louis-René Beaudoin: Order.


John Horne Blackmore: All right, Mr. Chairman.
I just wish to make this point. If people could realize how fcompletely irresponsible the great, big, overwhelming Liberal party is in this house with respect to this matter of building houses, they would be astounded.


Louis-René Beaudoin: Order. It appears
to me that the remarks being made by the hon. member are not relevant to the item under discussion.


John Horne Blackmore: I oan be relevant, Mr. Chairman, if relevancy is all that is necessary. I can speak right on this matter I am talking about, and I can say plenty more. The great question is this: When the members of the House of Commons go back to their constituencies, they will simply have to tell the people that nothing is to be done for housing.


An hon. Member:: You take your chance.


John Horne Blackmore: Of course you take your
chance. But the question is this: Will you get the houses? That is the thing that counts. Will you give the people that chance to have housing? The answer that is given by the Liberals is: No, we do not need to. Let them suffer. We do not care. We will not suffer. We Liberal members of parliament will be able to have houses. What do we care about the poor fellows down under who are getting too small an income to enable them to get a home? We do not care a button about them. They do not amount to anything at all. That is just the attitude of the ordinary Liberal. That is just exactly his attitude.


Some hon. Members:: Oh, no.


John Horne Blackmore: That is the attitude.


An hon. Member:: Oh, no, it is not.


John Horne Blackmore: The general attitude will be this: they will have to take it or leave it; we do not care.


An hon. Member:: Oh, no, it is not.


John Horne Blackmore: Oh, yes, it is.


Louis-René Beaudoin: I shall have to ask the hon. member not to discuss what he considers to be the attitude of other members of the House of Commons. He must discuss housing.


John Horne Blackmore: I am certainly discussing housing from the standpoint of about 45 per cent of all the people in Canada who find housing completely beyond their reach. The number of people in every community in this country who are wondering how in the world they are going to be able to afford housing is sufficiently large to constitute a complete scandal in this nation. I refer to the people who are called upon to pay $75, $80 or $90 for an apartment, when the cost of that living apartment likely uses up more than half of their total income. They must have housing. They have no alternative. That is a serious problem.
The point is that up until the present time this parliament has not done anything effective about the matter of housing. It chooses to leave at least forty per cent of the total population of Canada with inadequate housing and to indicate to the country that it is not ready to do a thing about it. No matter what facilities may be available to it with which to do something about it, it refuses to use those facilities. It chooses to let forty per cent of the people go with inadequate housing.
That is all, Mr. Chairman. If that is not enough to fill with shame all the men who
7, 1951
Supply-Resources and Development have responsibility in this parliament, then all I can say is that they just are not qualified to appreciate reality at all.


Joseph William Noseworthy: Following up the discussion we have just heard, may I say that I notice by this report of the Central Mortgage and Housing Corporation that last year the corporation made 476 loans directly for the building of non-farm homes and 3 loans for the building of farm homes. I should like to know just what is the policy of the corporation with regard to the making of direct loans, both urban and rural, and just why it is that there were only three farmers in Canada last year who obtained loans from the Central Mortgage and Housing Corporation.


Robert Henry Winters: The reason there were only three loans to farmers is that there were only three applications.


Joseph William Noseworthy: What is the policy with regard to direct loans? I refer to non-farm loans.


Robert Henry Winters: The whole policy underlying direct loans is that they will be made in outlying areas where lending institutions do not normally operate.


Julian Harcourt Ferguson: Am I led to believe that if farmers made application they would get a loan if everything was found to be correct, and that the only reason that only three farm loans were made is that only three applications were made? Were there not any made, of which some were turned down? It is quite surprising that only three applications were made, and that all three were granted, from all the farmers of Canada. Is that correct?


Robert Henry Winters: To the best of my knowledge and to the best of the recollection of the officials of the corporation, that is correct.


[Stage Direction]
Item agreed to.
Mr. Black (Cumberland):: What item is the chairman calling?


Louis-René Beaudoin: It was agreed that, instead of item 383, departmental administration, we would discuss the items relating to housing which are items 427 and 565. Item 565 has reference to Central Mortgage and Housing Corporation. Item 427 is the one dealing with emergency shelter administration. Both of those items have been discussed and carried. We will now revert to item 383.
383. Departmental administration, $381,223.


Percy Chapman Black: I do not know whether the minister wishes to proceed with this matter tonight. It has been the practice
3840	HOUSE OF COMMONS
Supply-Resources and Development
to have a general discussion on the first item, that of administration. The minister's department is an important one, which is asking in the estimates for more than $35 million. There are very many headings.
I do not know of any of them that is as important as the one that was discussed all day and all night, namely, the item of housing.
When the department was organized with the minister in charge we in Nova Scotia and eastern Canada expected a good deal from him and from the department. As one Nova Scotian to another I say to him that I want to see him succeed in his effort and to make a success of his department. But there is a feeling in Nova Scotia that very little progress has been made in the activities that have been assigned to this department.
I have a few items here such as the Chignecto canal and cheaper power for our part of the province. I doubt whether the minister has made an inspection of the Chignecto canal and whether he gave support to its construction when a very large delegation came here. It was rather enlightening to see the interest which the Minister of Transport took in the proposed St. Lawrence seaway. He accompanied a large delegation over the St. Lawrence river inspecting that part of the river in which the seaway is proposed to be built at a cost of hundreds of millions of dollars, and perhaps a billion dollars, which would give cheap power to central Canada when constructed. I do not say that I am opposed to that expenditure, but I would expect some compensating expenditures in my part of the country.
I should like to refer to the St. Mary's tidal power project, which was discussed in this house some sessions ago. The minister gave it his blessing at that time and said that he would see that it was investigated. Ever since that time we have been waiting for a report from the minister. It would create about two million horsepower or more and it would give us cheap power in eastern Canada. While they have cheap power and are looking for still cheaper power in central Canada we have had to meet increased costs of electric power in my part of Canada. The cost of power in that part of the country has increased by as much as one-third, 25 per cent and so on.
During the discussion of his estimates I should like the minister to make a statement on the results of the investigations of the St. Mary's tidal power project at the head of the bay of Fundy. If it could be constructed it would be very important to eastern Canada, and probably would warrant the electric smelting of the enormous tonnage of iron

ore which will be produced in Labrador and which it is expected will be shipped largely to the United States centres.
We have also been disappointed with the progress made in the construction of the bridge over the strait of Canso. While this matter may not come directly under the minister's department, it has to do with resources and development. I presume he is working in close conjunction with the Minister of Transport and the government.
We have also been disappointed in the building and putting into service of the ferry steamship from Nova Scotia to Maine. We have had that promised to us and it has been delayed. Eastern Canada, and especially Nova Scotia, have every reason to be disappointed. There is also the question of the trans-Canada highway which we shall discuss in some detail when the item is called. We were assured that there would be large expenditures long before this in the construction of a trans-Canada highway which would give direct service to every part of Canada by the shortest practical route. In Nova Scotia nothing has been done up to the present. We shall get a further explanation from the minister. Perhaps he will make a general statement on that item when it is called, but anyway we shall expect direct information from him.
In Nova Scotia we have also been disappointed that no headway apparently has been made with the construction of the Blomidon national park. We were given assurance, perhaps not by the minister, but by his predecessor, that headway was being made in building this park.
Another important subject which has to do with resources and development is railway freight rates. I should like to have a general statement from the minister with respect to that as it relates to Nova Scotia. We are not satisfied with the situation there at the present time.
I shall refer to one other item before eleven o'clock, namely, the dispersal of industry and the construction of defence industries in the maritime provinces and the desirability of dispersing these large plants in this country. During the discussion of building houses it was pointed out how difficult it is, in fact almost impossible, to supply housing in the large centres of central Canada to accommodate the workmen required in those centres where as much as $100 million is being expended in a single constituency, which is more than is being expended in all of the maritime provinces under this heading.
As opposed to the dispersal of industry, people from central Canada are going to Nova

Scotia and eastern Canada all the time draining off our workmen. Just a few days ago a large mining concern from central Canada asked for 1,000 men from Nova Scotia, labourers, to supplement the 2,000 that they had already procured in Nova Scotia. That is just one instance. There have been scores of them. Scores of industries are drawing labour from the maritime provinces, and particularly from Nova Scotia, where industries of our own should be established under this heading with the assistance and encouragement of the government.
Item stands.
Progress reported.



BUSINESS OF THE HOUSE

Alphonse Fournier: Tomorrow we will go into supply and continue with consideration
Supply-Resources and Development of the estimates of resources and development, and then take up the departments of fisheries, and mines and technical surveys.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
[The following items were passed in committee of supply]:

[Stage Direction]
Housing-
427. Emergency shelter administration, $250,000. Central Mortgage and Housing Corporation-
565. To provide for advances to Central Mortgage and Housing Corporation for the acquisition of land, the installation of services and improvements in respect thereof, the purchase of building materials and the construction or conversion of housing projects for veterans and for residents of Deep River, Ontario, under the authority of section 34 of the National Housing Act, 1944, $12,700,000.
3843
[Stage Direction]
Friday, June 8, 1951